lease define THREE of the following terms and provide an example of each one you have selected: • Conversion Costs • Direct Costs • Direct Labor Cost • Direct Materials Cost • Factory Overhead Cost • Indirect Costs • Period Costs • Prime Costs
lease define THREE of the following terms and provide an example of each one you have selected: • Conversion Costs • Direct Costs • Direct Labor Cost • Direct Materials Cost • Factory Overhead Cost • Indirect Costs • Period Costs • Prime Costs
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Please define THREE of the following terms and provide an example of each one you have selected:
• Conversion Costs
• Direct Costs
• Direct Labor Cost
• Direct Materials
• Factory
• Indirect Costs
• Period Costs
• Prime Costs
• Product Costs
Expert Solution
Step 1
Solution
Definition of any 3
Direct labor cost
Direct labor cost is the cost of labor that is directly incurred for the production of a particular goods or provision of particular service
Direct labor cost can be directly traced and allocated to that product
Example : A company incurred 20 labor hours for production of good A , at rate of $2 per hour
In this case =20*2 = $40 is the direct labor cost for product A
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