For Decision-Making Purposes,________ Costs Are Often Divided into Prime Costs

question 200

Multiple Choice

For decision-making purposes,________ costs are often divided into prime costs and conversion costs.

• A) fixed costs
• B) product costs
• C) period costs
• D) sunk costs

---

Definitions:

Raw Materials Inventories

Represents the stock of basic inputs that have not yet been used in the manufacturing process.

Manufacturer

A business or company engaged in the production of goods for sale, using labor, machines, tools, and chemical or biological processing or formulation.

Ready To Be Sold

A status indicating that products have completed the manufacturing process and are available for sale.

Lower-Of-Cost-Or-Market Basis

An accounting principle that values inventory at the lower of its historical cost or its current market price.