For gross income tax purposes, a manufacturing concerns cost of goods manufactured and sold shall include all costs of production of finished goods, such as raw materials, direct labor and manufacturing overhead, freight cost, insurance premiums, and other costs incurred to bring the new materials to the factory or warehouse.

TAXES

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Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

For gross income tax purposes, a manufacturing concern’s cost of goods manufactured and sold shall include all costs of production of finished goods, such as raw materials, direct labor and manufacturing overhead, freight cost, insurance premiums, and other costs incurred to bring the new materials to the factory or warehouse.

A	True
B	False
C	Either A or B
D	None of the above

Explanation:

Detailed explanation-1: -Direct labor refers to how much an organization pays in labor costs for a certain time period. You can calculate this value by multiplying the number of hours of work with the hourly rate for each employee.

Detailed explanation-2: -In order to calculate COGM, just add the Beginning WIP Inventory to the Total Manufacturing Cost, and subtract the Ending WIP Inventory. This will give you the total cost of the goods that were finished during the specified period.

Detailed explanation-3: -COGS includes costs such as raw materials and labour that vary depending on the amount of product you produce. It doesn’t include indirect costs that the business incurs regardless of how much is produced-for example, office expenses, administrative salaries or marketing costs.

Detailed explanation-4: -Answer and Explanation: Answer: d. Cost of goods manufactured + Beginning finished goods inventory-Ending finished goods inventory = Cost of goods sold.

There is 1 question to complete.

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BUISENESS MANAGEMENT

TAXES