Craig Manufacturing Company operates its three production departments within a single facility.Each department produces its own products and maintains its own production equipment.Although they share a common facility,each department is overseen by a separate supervisor.Which one of the following costs is a direct cost of each department?
A) Lease payment on facility
B) Depreciation on the facility
C) Production supervisor salary
D) Plant manager salary

Question

Quizplus · Accepted Answer

Production supervisor salary is a direct cost of each department since each department has its own supervisor who oversees the production operations within that specific department. The lease payment and depreciation on the facility are indirect costs since they are shared by all three departments, and plant manager salary is also an indirect cost since the manager oversees the entire facility, not just one specific department.

Craig Manufacturing Company Operates Its Three Production Departments Within a Single