Answer (D) is correct . Prime costs consist of direct materials and direct labor. The total is $52 ($32 + $20).
Answer (A) is incorrect because The amount of $73 properly includes direct materials and direct labor but improperly includes manufacturing overhead.
Answer (B) is incorrect because The amount of $32 properly includes direct materials but improperly excludes direct labor.
Answer (C) is incorrect because The amount of $67 properly includes direct materials and direct labor but improperly includes a portion of manufacturing overhead.
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Cole Lab’s estimated prime costs per unit are
