Question

Which of the following costs is a direct materials cost for a guitar manufacturing company?

a.The cost of the guitar stringsb.The cost of gluec.The cost of the oil used to lubricate the machineryd.The cost of the wood used in producing each guitar

Answer 1

The correct answer is D

Step-by-step explanation:

Manufacturing company or the business is the one who is involved in the manufacturing or making of the product. In short, converting the raw material into a finished good or product.

Direct cost of the manufactured products start with the raw materials that are converted into the finished products. And the cost or the price of any material which is an integral or the direct part of the finished product is known as direct cost.

For a guitar manufacturing company, a direct cost is the cost of the wood which is used in making or producing the guitar.