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prime costs only includes direct cost like direct material and direct labor.

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10y ago

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Is indirect cost a prime cost?

No


Prime cost and conversion cost?

Prime cost = direct materials + direct laborwhile conversion cost = direct labor + factory overhead( which includes indirect materials, indirect labor and other indirect costs


Is indirect labor part of prime cost?

Only direct material and direct labor is part of prime cost while overheads are part of conversion cost so indirect labor is part of overheads so automatically part of conversion cost and not prime cost.


Is indirect labor a part of prime cost?

Direct material and direct labor are the parts of prime cost while indirect labor is part of manufacturing overhead and manufacturing overhead is a part of conversion cost that's why indirect labor is not part of prime cost because it is that type of labor which is not directly identifiable with units production that;s why cannot charge directly to production units.


Is indirect labor a prime cost?

Indirect labor is that kind of labor which is not directly involved in making of unit of product that's why it is not a direct labor and that's why it is not prime cost of unit of product and that's why it is shown in overheads


What two cost elements are required to calculate an indirect cost rate?

Indirect cost rate is equal to Indirect Cost Pool divided by Indirect Cost Allocation Base.


Is variable overheads include in prime cost?

Direct labor and direct materials are the components of prime cost so no other cost is part of prime cost and hence variable overheads also not included in prime cost.


What two costs elements are required to calculate an indirect cost rate?

Indirect cost rate is equal to Indirect Cost Pool divided by Indirect Cost Allocation Base.


What is definition of prime cost?

The prime cost of a product is the direct cost which includes the materials and labor needed. This does not include the fixed costs attached to the material.


Is indirect labor a variable cost?

If indirect labor change with the change of units of product then indirect labor is a variable cost. If change in the quantity of units has no impact on indirect labor cost then it is a fixed cost.


What is the definition of material cost?

material costing is defined as the cost of product which only include the cost of materials and excludes all the indirect cost such as wages, overheads etc.


What are the indirect costs of tooth decay?

Indirect costs of tooth decay include things like lost productivity at work and school. Absenteeism due to dental appointments or severe pain is an indirect cost.