Indirect material, indirect labour and other manufacturing costs that are neither direct labour nor direct material costs are classified as:
A) manufacturing overhead.
B) product costs.
C) prime costs.
D) manufacturing overhead AND product costs.

Question

Quizplus · Accepted Answer

Manufacturing overhead includes all manufacturing costs that are not direct materials or direct labor, such as indirect materials, indirect labor, and other costs. Product costs include all costs involved in producing a product, which encompasses direct materials, direct labor, and manufacturing overhead. Therefore, the costs described are classified as both manufacturing overhead and product costs.

Indirect Material, Indirect Labour and Other Manufacturing Costs That Are