Which of the Following Is an Example of Direct Labor

question 200

Multiple Choice

Which of the following is an example of direct labor?

• A)Salary of a production manager
• B)Salary of the vice-president of operations
• C)Wages of assembly line personnel
• D)Wages of factory security

Know the structure of the contribution margin income statement and its use in classifying costs by behavior.

Understand the principles of activity-based costing (ABC) and its application in internal decision-making.

Differentiate between different types of costs in ABC including direct, indirect, manufacturing, and non-manufacturing costs.

Identify and classify activities in cost pools and compute activity rates.

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Definitions:

Coase Theorem

A principle that suggests that if property rights are well-defined and transaction costs are negligible, parties will negotiate to correct externalities without the need for government intervention.

Externality Problems

Issues arising when the actions of individuals or firms have effects on third parties that are not reflected in market prices.

Cost-Benefit Analysis

An organized method for assessing the positives and negatives of various alternatives, aimed at finding the optimal solution that maximizes benefits and maintains savings.

Pollution Rights

Permits or allowances that authorize the holder to emit a certain amount of a pollutant, used in regulatory approaches to manage environmental impacts.