Question

Which of the following costs is an example of a Selling & Administrative (S&A) cost rather than a product cost? Group of answer choices Depreciation on production equipment. Wages of salespersons. Wages of production machine operators. Insurance on factory equipment.

Answer 1

Answer:

The answer is B.

Explanation:

Option B. Wages of sales person are the example of a Selling and Administrative cost. Other examples are rents, distribution cost etc.

Option C is wrong. Wages of production machine operators is a direct wage. It will form part of cost of sales.

Option D is wrong. Insurance on factory equipment cannot be attributable to selling cost.