Commercial Applications
Costs incurred other than on material and labour for production and distribution are called ……………
- Labour cost
- Material cost
- Expense
- Variable cost
Cost
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Answer
Expense
Reason — As per the textbook: "Costs incurred other than on material and labour for production and distribution and for management of the organisation are called expenses." Expenses form the third basic element of cost (along with material and labour) and may be direct (e.g., hire charges of a specific machine) or indirect (e.g., factory rent, office expenses, selling expenses). Labour and material are themselves the other two elements; variable cost is a behavioural classification.
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