Manufacturing cost — what is excluded? In compiling the manufacturing cost for a chemical company, which item below is not included in manufacturing cost?

Introduction / Context:
Manufacturing cost summarizes the costs directly associated with producing the product: materials, utilities, labor, maintenance, and factory overheads. Separately, selling, general, and administrative (SG&A) costs belong to general expenses and are not part of manufacturing cost.

Given Data / Assumptions:

• We follow a common breakdown: direct product costs + plant overhead + fixed charges = manufacturing cost.
• Administrative expenses are SG&A items.

Concept / Approach:
Direct product costs include raw materials, operating labor, utilities, and packaging. Plant overheads include supervision, maintenance, and factory services. Fixed charges may include local taxes, insurance, and depreciation associated with production. Administrative expenses (corporate salaries, office rent, legal) are not part of manufacturing cost; they are counted in general expenses and subsequently in total product cost.

Step-by-Step Solution:

Verification / Alternative check:
Standard cost statements: Total product cost = manufacturing cost + general expenses. Administrative is within general expenses, confirming exclusion from manufacturing cost.

Why Other Options Are Wrong:

Common Pitfalls:
Mixing selling and administrative costs with plant overheads. Keep factory vs. corporate buckets separate for clean comparisons.

Final Answer:
Administrative expenses