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JAMB Principles of Accounts 2003 Question 26

Question 26

Manufacturing Accounts

Four broad classifications of overheads are

  1. A.production, selling, distribution and material
  2. B.production, selling, distribution and administration
  3. C.selling, distribution, production and wages
  4. D.distribution, selling, administration and material
Show the answer and explanation

Answer: B (production, selling, distribution and administration)

Explanation

Overheads are indirect costs grouped as production, selling, distribution and administration; materials and wages are direct costs.