Question

Which of the following would be classified as a factory overhead cost by a baking company?a. depreciation of office equipmentb. strawberriesc. depreciation of factory equipmentd. freight to deliver the product to the customer

Answer 1

c. Depreciation of factory equipment

Step-by-step explanation:

All costs incurred as a result of production activities excluding labor cost and direct material costs are called factory overhead costs. These costs are accumulated before allocation is done on a basis consistent with the entity's policy. example of factory overhead costs incurred in the production process are, factory rent, production supervisor's salary, depreciation of factory plant and equipment, e.t.c.