Question

Which of the following may not be a factory overhead cost? a.insurance on factory equipment b.property tax on factory building c.materials used directly in the manufacturing process of the product d.salaries of production supervisors

Answer 1

c.materials used directly in the manufacturing process of the product

Step-by-step explanation:

Factory cost or production cost are usually classified as direct or indirect.

Direct cost are those costs incurred that are directly linked to production.

This includes direct labour, direct material, etc. Indirect costs are also referred to as overheads.

These are cost incurred that may not be linked directly to the production of goods and services. Examples include salaries of production supervisors, insurance on factory equipment etc,