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Indirect material used in production is classified as.a.production overhead.b.distribution overhead.c.selling overhead.d.office overhead.

Question

Indirect material used in production is classified as.a.production overhead.b.distribution overhead.c.selling overhead.d.office overhead.

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Solution

Indirect material used in production is classified as a. production overhead.

Here's why:

In cost accounting, costs are classified into direct and indirect costs. Direct costs are those that can be directly attributed to the production of specific goods or services. This includes direct materials and direct labor.

Indirect costs, on the other hand, cannot be directly attributed to the production of specific goods or services. These costs are incurred for the overall operation of the business and include items like rent, utilities, and indirect materials and labor.

Indirect materials are materials used in the production process, but which cannot be directly linked to a specific product. For example, cleaning supplies used in a factory would be considered indirect materials.

Since these materials are used in the production process, but cannot be directly linked to a specific product, they are considered part of the production overhead. Production overhead, also known as manufacturing overhead or factory overhead, includes all costs related to the manufacturing process that are not direct materials or direct labor.

So, the correct answer to your question is a. production overhead.

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Similar Questions

The factory overhead is also termed as. (कारखाना उपरिव्यय का दूसरा नाम निम्न में से क्या है)a.Establishment Overhead (स्थापना उपरिव्यय)b.Selling Overhead (बिक्री उपरिव्यय)c.Distribution Overhead (वितरण उपरिव्यय)d.Works on cost (लागत पर कार्य)

Depreciation of plant and machinery is a part of.a.selling overhead.b.administration overhead.c.distribution overhead.d.factory overhead.

Indirect material scrap is adjusted along with .a.factory cost.b.labour cost.c.prime cost.d.cost of goods sold.

Overhead costs are assigned to production using an overhead application rate, whereas no such "application rate" is used to assign the costs of direct materials and direct labor to production. The reason for this difference in procedures is that:Multiple ChoiceOverhead is an indirect cost which cannot be traced easily and directly to specific units of product.Overhead is always larger in dollar amount than either direct materials or direct labor.The amounts of direct material and direct labor applicable to each unit of production cannot be determined as easily as the amount of overhead.Overhead is always equal to a constant percentage of direct labor costs.

Indirect costs are:Question 2Answera.Costs that can be directly attributed to the production of goodsb.Costs that cannot be easily traced to a specific cost objectc.Fixed costs that remain constant regardless of activity levelsd.Easily traceable to a specific cost object

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