Which of the Following Would Be Considered a Product Cost

question 178

Multiple Choice

Which of the following would be considered a product cost for a manufacturing company?

• A) depreciation on delivery vehicles
• B) depreciation on administrative building furniture and fixtures
• C) depreciation on manufacturing equipment
• D) depreciation on the accounting department's computer equipment

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Definitions:

Income Tax Rate

The percentage at which an individual or corporation is taxed on their income.

Interest Expense

The cost incurred by an entity for borrowed funds, typically reported on the income statement as a non-operating expense.

Net Profit Margin Percentage

A financial metric expressing the percentage of revenue remaining after all operating expenses, interest, taxes, and preferred stock dividends have been deducted from a company's total revenue.

Gross Margin

The difference between sales revenue and the cost of goods sold, indicating the profitability of a company's core activity.