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Unformatted text preview: Chapter 2 Q&A Q1. What are manufacturing costs and define the three cost categories included in manufacturing costs. (Chapter 2 Section 1) A1. Manufacturing costs are all the costs associated with the production of goods. The three cost categories included in manufacturing costs are direct materials cost, direct labor cost, and manufacturing overhead. Direct materials cost is the cost of all materials and parts that are directly traced to items produced. Direct labor cost is of labor that is directly traced to items produced. Manufacturing overhead is the cost of all manufacturing activities other than direct material and direct labor. It includes indirect material and indirect labor, as well as a wide variety of other cost items. Q2. What are general administrative costs? Give some examples. (Chapter 2 Section 1) A2. General administrative costs are a type of nonmanufacturing costs or period costs. They include all of the costs associated with the firm's general management. Some examples of general administrative of the costs associated with the firm's general management....
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This note was uploaded on 02/04/2011 for the course ACG 2071 taught by Professor Lopez during the Summer '08 term at Valencia.
- Summer '08
- Managerial Accounting