The total cost of an item is the sum of:
A)both its direct and indirect costs
B)direct costs,indirect costs and manufacturing overhead
C)total indirect costs divided by number of units
D)none of the options is correct

Question

Quizplus · Accepted Answer

The total cost of an item is the sum of both its direct and indirect costs. Direct costs are expenses that can be directly attributed to the production of a specific product or service, such as the cost of raw materials or labor. Indirect costs, on the other hand, are expenses that cannot be directly attributed to a specific product or service, such as rent or utilities. Therefore, the total cost of the item must include both direct and indirect costs.

The Total Cost of an Item Is the Sum Of