direct materials
→ -:- the raw materials used to create inventory
→ -:- direct materials example:
steel, glass, electric wire --> build a boat
direct labor
→ -:- the labor costs that can easily be traced to the development of a company's
inventory
→ -:- direct labor example:
sho...
Best Grades | Must Pass | Latest Update | Correct Answers | 2024/2025
GARRISON CH. 2 : managerial accounting
& cost concepts Questions and Correct
Answers | Latest Update
direct materials
→ -:- the raw materials used to create inventory
→ -:- direct materials example:
steel, glass, electric wire --> build a boat
direct labor
→ -:- the labor costs that can easily be traced to the development of a company's
inventory
→ -:- direct labor example:
shop worker, Bob, works all day on boat #A753
Bob's work can easily be traced to job #A753
manufacturing overhead
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, Best Grades | Must Pass | Latest Update | Correct Answers | 2024/2025
→ -:- all manufacturing costs except direct labor & direct materials
→ -:- manufacturing overhead examples:
a) indirect materials --> grease for the shop's machines
b) depreciation on all shop items
c) indirect labor --> shop supervisor
conversion costs:
manufacturing overhead + direct labor
→ -:- conversion costs:
_______ ________ + _______ _________
direct materials + direct labor
→ -:- prime costs
_________ _________ + _______ _________
sunk cost
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