Which of the following items would appear in the factory overhead section of a manufacturing account?
ACarriage inwards on raw materials
BRoyalties paid on units produced
CIndirect factory wagesCORRECT
DCost of direct materials used
GCEFinancial AccountingManufacturing Accounts2023
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Why the answer is C, and why the others tempt you.
Indirect factory wages (e.g., wages of cleaners, storekeepers, and supervisors in the factory) are factory overheads. Carriage inwards on raw materials and royalties paid on units produced are direct expenses forming part of prime cost, while direct materials are also a prime cost item.
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