Which of the following would be classified as a prime cost?
A) cost of direct materials used
B) depreciation on factory equipment
C) salary of sales personnel
D) depreciation on office furniture

Question

Quizplus · Accepted Answer

A prime cost is a direct cost that is directly attributable to the production of a product, such as the cost of direct materials used. Depreciation on factory equipment, salary of sales personnel, and depreciation on office furniture are not considered prime costs.

Which of the Following Would Be Classified as a Prime