Factory Cleaners' Wages as Indirect Factory Overheads

Steps:

• Classify wages to factory cleaners as indirect labor, not direct production costs.
• Add these wages to the factory overheads section of the manufacturing account.
• Recalculate total factory overheads, increasing this item (likely item 2).
• Adjust the total cost of production (likely item 4) by absorbing the higher overheads.
• Confirm no impact on direct materials or prime cost items (1 and 3).

Why C is correct:

• Factory overheads (item 2) directly increase with indirect wages, and total manufacturing cost (item 4) rises accordingly, per standard manufacturing account structure.

Why the others are wrong:

• A: Items 1 (direct materials) and 2 unaffected by indirect costs; only 2 changes here.
• B: Includes 1 (direct materials) and 3 (prime cost), which exclude indirect overheads by definition.
• D: Omits item 2 (overheads), the primary addition point for cleaners' wages.

Final answer: C