Sturbridge Company manufactures fine furniture and grandfather clocks.Sturbridge has an excellent reputation,and each grandfather clock sells for several thousand dollars.Which of the following should not be treated as direct costs,assuming the cost object is individual clocks?
A) The clock face
B) The timing mechanism for each clock
C) Wood
D) Depreciation on clock-making equipment

Question

Quizplus · Accepted Answer

Depreciation on clock-making equipment is an indirect cost as it is not directly traceable to individual clocks. The other options, clock face, timing mechanism, and wood, are direct costs as they are directly used to make each clock.

Sturbridge Company Manufactures Fine Furniture and Grandfather Clocks