fixed o/h, variable o/h and semi-variable o/h
controllable o/h and uncontrollable o/h
manufacturing o/h, administration o/h and selling & distribution o/h
past cost and future cost
Answer is Wrong!
Answer is Right!
The correct answer is: C. manufacturing o/h, administration o/h and selling & distribution o/h
Overhead can be classified according to function-wise as:
- Manufacturing overhead: This is the cost of production that is not directly attributable to a specific product or service. It includes costs such as indirect labor, indirect materials, and factory overhead.
- Administration overhead: This is the cost of running the business that is not directly attributable to a specific product or service. It includes costs such as salaries for administrative staff, rent for office space, and utilities.
- Selling and distribution overhead: This is the cost of selling and distributing products or services. It includes costs such as salaries for sales staff, commissions, and shipping costs.
The other options are incorrect because they do not classify overhead according to function. Option A classifies overhead according to its behavior, as fixed, variable, or semi-variable. Option B classifies overhead according to its controllability, as controllable or uncontrollable. Option D classifies overhead according to its timing, as past cost or future cost.