Total Manufacturing Costs Incurred During the Year Do Not Include

question 129

Multiple Choice

Total manufacturing costs incurred during the year do not include:

• A) Direct materials used.
• B) Factory supplies used.
• C) Goods in process inventory, beginning balance.
• D) Direct labor.
• E) Depreciation of machinery.

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Definitions:

Straight-Line Depreciation

A method of depreciating an asset evenly over its useful life, allocating an equal portion of the asset's cost as an expense in each accounting period until it reaches its salvage value.

Depreciable Cost

Depreciable cost is the cost of a fixed asset minus its salvage value, over which the asset's cost can be depreciated over its useful life.

Partial Year

A term referring to a portion of a year, often used in the context of accounting and financial analysis for periods less than 12 months.

Gain or Loss

The financial result from selling an asset for more (gain) or less (loss) than its carrying amount on the books.