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Direct cost increases when ______. - Commercial Applications

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Question

Direct cost increases when ______.

Options

  • Sales price of product increases

  • Cost of raw material increases

  • Tax increases

  • Subsidy increases

MCQ
Fill in the Blanks

Solution

Direct cost increases when cost of raw material increases.

Explanation:

Direct costs rise when the cost of raw materials increases because these expenses are directly tied to the production of goods. As raw materials are essential components, any price fluctuation directly impacts the total production cost.

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Classification of Costs
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Chapter 8: Fundamental Concepts of Cost - EXERCISES [Page 133]

APPEARS IN

Goyal Brothers Prakashan Commercial Studies [English] Class 10 ICSE
Chapter 8 Fundamental Concepts of Cost
EXERCISES | Q 20. | Page 133
Goyal Brothers Prakashan Commercial Applications [English] Class 10 ICSE
Chapter 8 Fundamental Concepts of Cost
EXERCISES | Q 30. | Page 138
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