Multiple choice

Non-manufacturing cost does not include

  1. advertising cost

  2. raw material cost

  3. sales commission cost

  4. manager's salary cost

Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

 Raw material cost is not included in non-manufacturing cost, but in manufacturing cost. Since raw materials are directly involved in manufacturing of the product, it is a manufacturing cost. For example, the cost of iron-ore purchased for conversion into steel is a manufacturing cost, since iron-ore is a raw material for manufacturing steel.