Raw Materials Are Unprocessed Expense Items Such as Farm Products

question 65

True/False

Raw materials are unprocessed expense items such as farm products and natural products.

---

Definitions:

Direct Labor-Hours

A measure of the actual labor time spent on producing goods, often used to allocate manufacturing overhead to products.

Plantwide Predetermined Rate

A single overhead absorption rate calculated for an entire manufacturing plant, used to allocate manufacturing overhead to individual products.

Machine-Hours

A measure of production time, indicated by the number of hours machines are operating in the manufacturing process.

Manufacturing Cost

The total cost incurred by a company to produce goods, including raw materials, labor, and overhead.