Which of the following would be classified as a prime cost?
A)cost of raw materials
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 tied to the production of goods, such as the cost of raw materials. Depreciation on factory equipment and office furniture are indirect costs, and the salary of sales personnel is not related to the production of goods.

Which of the Following Would Be Classified as a Prime