Which one of the following statements describes prime cost? Prime cost is the total of:
A)Direct and indirect production costs.
B)Direct materials, direct labour and expenses.
C)Production overheads.
D)The total of indirect costs.

Question

Quizplus · Accepted Answer

Prime cost is the sum of the direct costs of a product or service, which includes direct materials, direct labor, and direct expenses. It does not include indirect costs such as production overheads or indirect materials and labor.

Which One of the Following Statements Describes Prime Cost? Prime