Question

The following costs were incurred in May:

Direct materials 44,600
Direct labor 28,900
Manufacutring overhead 18,400
Selling expenses 23,200
Administrative expense 35,00
Prime cost during the month totaled:

Answer 1

The prime cost is the sum of direct materials and direct labor, which in this case is $73,500.

Step-by-step explanation:

The prime cost is the sum of direct materials and direct labor, which are the costs directly associated with the production of goods or services. In this case, the direct materials cost is $44,600 and the direct labor cost is $28,900. To calculate the prime cost, simply add these two values together:

Prime cost = Direct materials + Direct labor

Prime cost = $44,600 + $28,900 = $73,500