A manufacturing plant produces two product lines: golf equipment and soccer equipment.An example of direct costs for the golf equipment line is ________.

Question

Quizplus · Accepted Answer

Monthly lease payments for the specialized equipment needed to manufacture the golf driver are directly related to the production of golf equipment and are therefore considered direct costs. Beverages provided in the break room and salaries of clerical staff in administrative offices are not directly related to the production of either product line and are considered indirect costs. Overheads incurred in producing both product lines are also indirect costs.

A Manufacturing Plant Produces Two Product Lines: Golf Equipment and Soccer