Which of the following costs are not included in finished goods inventory? a. direct materials b. factory overhead c. direct labor d. chief financial officer's salary

Question

Catherine Bird

Social Studies

13 October, 20:48

Which of the following costs are not included in finished goods inventory? a. direct materials b. factory overhead c. direct labor d. chief financial officer's salary

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Answers (1)

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Ryan Brennan · Answer 1

D). Chief financial officer's salary.

Explanation:

'Finished goods inventory' is the term that is employed to describe the amount or number of finished (manufactured) goods available in stock for the customers to buy.

As per the question, option D i. e. 'chief financial officer's salary' would not be included in the cost of finished goods inventory as he has no affiliation or role in the production of these goods which would be available in the market for purchase. The other things like direct materials, direct labor, or factory overhead are the significant factors responsible for production of these goods and thus, these costs would be included in the finished goods inventory. Thus, option D is the correct answer.