Which item is normally classified as a selling and distribution overhead?
Correct answer: D. Commission paid to sales representatives
- A. Power used by manufacturing equipment
- B. Depreciation of factory machinery
- C. Wages of production-line workers
- D. Commission paid to sales representatives
Explanation
Sales commission is incurred to obtain and distribute sales, so it is a selling and distribution overhead. Factory machinery depreciation, production wages and manufacturing power are production-related costs.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? [email protected]
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.
Practise Cost Accounting
941 free Cost Accounting MCQs from Accounting, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Discussion
Stuck on an option, or know a faster way to get there? Ask or explain it here.
No comments yet. Be the first to explain this one.
Exams that ask Accounting questions like this
Accounting is on 2 papers prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for every one of them.
More Cost Accounting questions
Which statement best describes cost reduction?
What does life-cycle costing include when measuring the total cost of a product?
Total production cost is Rs. 50,000 for 1,000 units and Rs. 50,600 for 1,010 units. What is the marginal cost per additional unit?
In standard costing, a standard cost is best described as:
If the beginning work in process inventory units are 2600, units started are 9000, ending work in process units are 2300 and the completed good units are 8000 then total spoilage will be ____________?
If the units of normal spoilage are 150 and the total good units manufactured are 1500, then the normal spoilage rate would be __________?