Which of the following is an example of direct expense?
Answer Details
Manufacturing wages is an example of a direct expense.
Direct expenses are costs that are directly linked to the production of goods or services. In this case, manufacturing wages are wages paid to workers who are directly involved in the production process of the goods being manufactured. These wages are directly tied to the manufacturing process and are necessary for the production of goods.
On the other hand, royalties are payments made for the use of intellectual property such as copyrights, patents or trademarks, and are not directly related to the production of goods. Carriage inwards is the cost of transporting goods purchased by a business from a supplier, which is not directly linked to the production process. Carriage outwards is the cost of transporting goods sold by a business to its customers, which is also not directly related to the production process.