Which of the Following Is Normally Included in Product Cost

question 118

Multiple Choice

Which of the following is normally included in product cost under the variable costing method?

• A) Direct materials cost, direct labour cost, but NOT manufacturing overhead cost.
• B) Direct materials cost, direct labour cost, and variable manufacturing overhead cost.
• C) Prime cost but NOT conversion cost.
• D) Prime cost and all conversion cost.

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Definitions:

Economic Growth

The increase in the inflation-adjusted market value of the goods and services produced by an economy over time, reflecting improvements in living standards.

Funding

The act of providing financial resources, typically in the form of money, or other values such as effort or time, to support a program, project, business, or individual.

Scarcity

A fundamental economic problem of having seemingly unlimited human wants in a world with limited resources, which leads to the necessity of making choices on how to allocate resources.

Resources

Assets or inputs used in the production of goods and services, such as time, labor, and capital.