Final answer:
In a service firm, direct materials are those that are integral to the service provided and can be directly traced to a job. Scissors at a hair salon qualify as these can be traced directly to the cost of providing the haircutting service. Other items mentioned like tools, paperwork, and beds are not direct materials due to their indirect association with service costs or function as long-term assets.
Step-by-step explanation:
The student's question 'Which of the following would be considered direct materials in a service firm that uses job-order costing?' refers to identifying the materials that are directly tied to the service being provided in a job-order costing system.
Job-order costing is an accounting method used to track costs and operate in industries where the products or services are completed in distinct lots or jobs. In a service firm, direct materials are those that can be directly traced to a job and are a significant part of the service's cost. Considering the options given:
- Scissors at a hair salon can be considered direct materials because they are essential and integral to the haircutting service provided.
- Tools in an auto repair shop are not direct materials but rather indirect materials or overhead, as they are used across various jobs and not specifically traceable to a single client's car repair job.
- Paperwork at a law firm is not a direct material, as it is not significant to the cost of providing legal services. Instead, these fit into other cost categories like administrative or overhead expenses.
- Beds in a hospital are not direct materials for services rendered, as they are used by multiple patients and represent a long-term asset used over time.
Therefore, the answer is Scissors at a hair salon, which would be considered direct materials in a service firm using job-order costing.