Warehouse rent is a part of _________?
Correct answer: C. distribution cost.
- A. prime cost.
- B. factory cost.
- C. distribution cost.
- D. production cost
Explanation
Rent for a warehouse used to store completed goods is incurred after production and is associated with storing and delivering products, so it is treated as distribution cost. A warehouse used solely for raw materials within the factory could be classified differently, but that is not stated here.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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