Which of These Is an Indirect Cost If the Cost

question 42

Multiple Choice

Which of these is an indirect cost if the cost object is the servicing department of a motor vehicle dealership?

• A) Rental of full site of business premises.
• B) Wages of servicing mechanics.
• C) Maintenance of servicing machinery.
• D) Spare parts for the servicing of vehicles.

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Definitions:

Realizing Profits

The process by which a firm converts its operations and investments into financial gains or returns.

Economic Profits

The disparity between a company's overall income and its comprehensive economic expenses, accounting for both direct (explicit) and indirect (implicit) costs.

Purely Competitive

A market structure characterized by many sellers offering identical products, leading to no single seller influencing the market price.

Market Price

The present cost at which a service or asset is available for purchase or sale in a specific market.