Question

Direct materials are a:

1)Product Cost
2) Manufacturing Overhead Cost
3) Period Cost
A. Yes, Yes, No
B. Yes, No, No
C. Yes, Yes, Yes
D. No, No, No

Answer 1

Direct materials are a product cost but not a manufacturing overhead or a period cost, with the correct answer to the student's question being 'B. Yes, No, No.'

Step-by-step explanation:

Direct materials are considered a product cost because they are used directly in the production of goods and are easily traceable to a particular product. These costs are not considered manufacturing overhead, which typically includes indirect costs that are associated with the manufacturing process but are not directly traceable to specific units of product, such as factory maintenance or management salaries. Direct materials are also not period costs, as period costs are all the costs that are not involved in the manufacturing process and are typically associated with non-manufacturing functions, like selling and administration expenses. Therefore, the correct answer to the question would be 'B. Yes, No, No.'