Which of the following costs would be classified as overhead costs?

Overhead costs are the expenses incurred in the manufacturing process that are not directly tied to the creation of a product. These costs are necessary for production but cannot be directly traced to specific units of product.

In this case, factory insurance costs fall into the category of overhead because they are essential for the operation of the manufacturing facility but do not directly relate to a specific product being made. They support the overall manufacturing environment and cover risks that are essential to maintaining production capability, which makes them a prime example of manufacturing overhead.

Direct labor and direct materials, on the other hand, can be directly associated with the production of individual products. Direct labor refers to the wages paid to workers who are directly involved in making products, and direct materials are the raw materials that are used in the manufacturing of products. Product packaging costs may also be linked directly to the product itself, meaning they are not classified as overhead costs in the same way factory insurance costs are.