Question

The following costs were incurred in May:

Direct materials $ 48,200
Direct labor $ 24,400
Manufacturing overhead $ 18,400
Selling expenses $ 20,700
Administrative expenses $ 32,400
Prime costs during the month totaled:
a) $72,600
b) $42,800
c) $91,000
d) $144,100

Answer 1

Step-by-step explanation:

The prime costs are the sum of direct materials cost and direct labor cost.

So, prime costs = Direct materials + Direct labor

prime costs = $48,200 + $24,400

prime costs = $72,600

Therefore, the prime costs during the month totaled $72,600.

The correct answer is (a) $72,600.