Which of the following statements is true?

Select one:

a.

The prime cost of a product is the highest possible cost than can be incurred to produce that product

b.

The prime cost refers to the direct costs of the product such as direct labour, materials and other direct expenses.

c.

Only prime costs are considered when calculating the cost per unit under an absorption costing method.

d.

Prime costs include additional costs which may be incurred if a product/service exceeds its standard cost.