direct cost(redirected from prime cost)
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A cost that can be directly related to producing specific goods or performing a specific service. For example, the wages of an employee engaged in producing a product can be attributed directly to the cost of manufacturing that product. Certain other costs such as depreciation and administrative expenses are more difficult to assign and are not considered direct costs. Compare indirect cost.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
prime costthe sum of the DIRECT MATERIALS cost and the DIRECT LABOUR cost of a product. Direct costs tend to vary proportionately with the level of output. See COST.
Collins Dictionary of Business, 3rd ed. © 2002, 2005 C Pass, B Lowes, A Pendleton, L Chadwick, D O’Reilly and M Afferson
direct costthe sum of the DIRECT MATERIALS cost and DIRECT LABOUR cost of a product. Direct cost tends to vary proportionately with the level of output. See VARIABLE COST.
Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005