Select the Appropriate Classification for Each of the Costs Incurred

question 20

Multiple Choice

Select the appropriate classification for each of the costs incurred by a manufacturer of automobiles.
-factory janitorial costs

• A)direct materials
• B)direct labor
• C)overhead
• D)selling expense
• E)administrative expense

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Definitions:

Owner's Equity

The residual interest in the assets of a business after deducting liabilities, representing the ownership interest of shareholders in a company.

Balance Sheet

A financial statement that presents a company’s financial position, showing assets, liabilities, and equity at a specific point in time.

Bookkeeper

A person responsible for recording the financial transactions and maintaining the financial records of a business.

Basic Accounting Equation

An equation representing the relationship between a company's assets, liabilities, and shareholders' equity (Assets = Liabilities + Equity).