O-LevelAccountingAccounting procedures7707/12 · Oct/Nov 2014 · Q261 Mark

How is prime cost calculated?

Adirect materials + direct labour

Bdirect materials + direct labour + direct expenses

Cdirect materials + direct labour + direct expenses + factory overheads

Ddirect materials + direct labour + direct expenses + factory overheads + change in work in progress

✓ Correct answer

B: direct materials + direct labour + direct expenses

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Topic: Accounting procedures, O-Level Accounting (syllabus 7707). Multiple choice, 1 mark.
Source: O-Level Accounting, Oct/Nov 2014 Paper 1 Variant 2, question 26.

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