Total manufacturing costs are equal to
A) Direct Materials + Direct Labor + Selling Costs.
B) Direct Materials + Direct Labor + Overhead.
C) Direct Labor + Overhead + Selling Costs + Administrative Costs.
D) Product Costs + Period Costs.

Question

Quizplus · Accepted Answer

Total manufacturing costs include direct materials, direct labor, and overhead costs. Selling costs and administrative costs are not included in the manufacturing costs. Option A is incorrect because it only includes direct materials, direct labor, and selling costs. Option C is incorrect because it includes selling costs and administrative costs which are not related to the manufacturing process. Option D is incorrect because it combines product costs (direct materials, direct labor, and overhead) with period costs, such as selling and administrative costs, which is not an accurate representation of total manufacturing costs.

Total Manufacturing Costs Are Equal to