1.1 CONCEPTS
Give ONE cost category for each of the following descriptions by choosing a cost category from the list below - NSC Accounting - Question 1 - 2016 - Paper 1
Question 1
1.1 CONCEPTS
Give ONE cost category for each of the following descriptions by choosing a cost category from the list below. Write only the cost category next to the... show full transcript
Worked Solution & Example Answer:1.1 CONCEPTS
Give ONE cost category for each of the following descriptions by choosing a cost category from the list below - NSC Accounting - Question 1 - 2016 - Paper 1
Step 1
1.1.1 Salaries paid to office workers
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Answer
This is categorized as an administration cost since it involves salaries that are not tied directly to manufacturing activities.
Step 2
1.1.2 Cost of raw materials used in the production process
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Answer
This is classified as a direct material cost because it directly relates to the inputs used in the production of goods.
Step 3
1.1.3 Commission paid to salespersons
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Answer
This falls under selling and distribution cost since it pertains to expenses related to selling activities.
Step 4
1.1.4 Rent paid for factory buildings
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Answer
The appropriate category here is factory overhead cost, as it includes expenses for the facilities used in production.
