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Which of the following is an indirect cost? a
Which of the following is an indirect cost?
- a. The cost of denim in a jeans factory
- b. The cost of mixing labor in a factory that makes over-the-counter pain relievers
- c. The cost of bottles in a shampoo factory
- d. The cost of restriping the parking lot at a perfume factory
- e. All of these.
Expert Solution
The cost of restriping the parking lot at a perfume factory is an indirect cost because the indirect cost is a cost that are not easily traced to a product while the direct costs are easily traced to a product. All the cost except the cost of restriping the parking lot at a perfume factory are direct cost.
Correct option is d). The cost of restriping the parking lot at a perfume factory.
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