direct materials, direct wages and indirect expenses
indirect materials and indirect labour and indirect expenses
direct materials, direct wages and direct expenses
direct materials, indirect wages and indirect expenses
Answer is Wrong!
Answer is Right!
The correct answer is: C. direct materials, direct wages and direct expenses.
Prime cost is the direct costs incurred in the production of a product. It includes the cost of direct materials, direct labor, and direct expenses.
- Direct materials are the materials that are used in the production of a product and can be easily traced to the finished product. For example, the wood used to make a table is a direct material.
- Direct labor is the labor that is directly involved in the production of a product. For example, the labor of the workers who assemble the table is direct labor.
- Direct expenses are the expenses that are directly related to the production of a product. For example, the cost of the electricity used to power the machines that assemble the table is a direct expense.
Indirect materials, indirect labor, and indirect expenses are not included in prime cost. These costs are not directly related to the production of a product and cannot be easily traced to the finished product. For example, the cost of the electricity used to light the factory is an indirect expense.
I hope this helps!