Which of the Following Is a Product Cost for a Manufacturing

question 70

Multiple Choice

Which of the following is a product cost for a manufacturing company?

• A) salary of administrative staff
• B) wages paid to factory janitor
• C) commissions paid to sales staff
• D) depreciation on corporate building

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Definitions:

Option Contract

A contract that gives the buyer the right, but not the obligation, to buy or sell an underlying asset at a specified price on or before a specified date.

Basis Risk

The risk that the price of a hedge and the asset being hedged will not move in perfect correlation.

Call Option

A financial arrangement granting the buyer the freedom, but not the duty, to acquire an asset such as a stock, bond, commodity, at a set price within an established timeframe.