Commercial Applications
Answer
False
Reason — Raw materials that become an integral part of the finished product and can be easily measured and directly charged to the product are direct materials (a direct cost), not indirect. For example, cloth in dress making and timber in furniture are direct materials. Only items like grease, oil, nails and consumable stores — which cannot be specifically charged to a product — are treated as indirect materials.
Related Questions
'The product has some value which can be measured in terms of money' it is called ……………
- Historical value
- Exchange value
- Zero value
- Positive value
A typical factory overhead cost is ……………
- Audit
- Compensation of plant manager
- Design distribution
- Internal
In element-wise classification of overheads, which one of the following is not included in?
- Fixed overheads
- Indirect labour
- Indirect materials
- Indirect expenditure
Match the following types of costs with their correct examples:
Types of Cost Examples (a) Direct Material 1. Wages paid to quality inspectors (b) Indirect Labour 2. Cloth used in dress making (c) Indirect Material 3. Nails used in carpentry work (d) Direct Labour 4. Salary of a factory manager - a-2, b-4, c-3, d-1
- a-3, b-1, c-2, d-4
- a-4, b-3, c-2, d-1
- a-1, b-2, c-3, d-4