O Level Accounting (7707)•7707/11/M/J/23

Explanation
Insufficient data for prime cost calculation
Steps:
- Prime cost = direct materials used + direct labor + direct expenses (excludes overheads and inventories).
- Given: closing finished goods inventory (1860), factory overheads ($1550).
- No data on direct materials, direct labor, or direct expenses provided.
- Cannot compute prime cost without these essential components.
Why B is correct:
- Not enough information; no option can be verified as prime cost lacks required direct cost details.
Why the others are wrong:
- A: Arbitrary sum, ignores missing direct costs.
- C: Possible addition of inventories + overheads (1860 + 5490, not $8600), but irrelevant to prime cost.
- D: No basis in given data or prime cost formula.
Final answer: Not enough information.
Topic: Manufacturing accounts
Practice more O Level Accounting (7707) questions on mMCQ.me