Answer (C) is correct . Direct costs are readily identifiable with and attributable to specific units of production. Wood is a raw material (a direct cost) of furniture.
Answer (A) is incorrect because Machine repairs in an automobile factory are usually an overhead (indirect) cost.
Answer (B) is incorrect because Electricity in an electronics plant is usually an overhead (indirect) cost.
Answer (D) is incorrect because Sales commissions are period costs. They are neither direct nor indirect costs of products.
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