In: Accounting
Required: Identify each of the costs accordingly by placing an “X” in the appropriate boxes. Each cost can be classified multiple times. Please tell why for each. Thank you
Product |
Period |
Variable |
Fixed |
Direct Material |
Direct Labor |
Manufacturing Overhead |
|
Oil to keep a factory machinery lubricated |
|||||||
Aluminum used in the manufacturing of bicycles |
|||||||
Fabric used in the manufacture of baseball jerseys |
|||||||
Wages of sewing machine operators making baseball jerseys |
|||||||
Janitorial supplies used in a factory’s restrooms |
|||||||
The advertising manager’s salary |
|||||||
Copy paper to replenish the fax machine in the sales office. |
Product | Period | Variable | Fixed | Direct Material | Direct Labor | Manufacturing Overhead | Remarks | |
Oil to keep a factory machinery lubricated | x | It Factory Overhead as it machinery needed to be lubricated irrespective if the manufacturing is being done or not. | ||||||
Aluminum used in the manufacturing of bicycles | x | Its directly co related with the production of the bicycle without which the bicycle can not manufacured | ||||||
Fabric used in the manufacture of baseball jerseys | x | Direct relationship with the manufacturing of the Jerseys | ||||||
Wages of sewing machine operators making baseball jerseys | x | Direct relationship with the manufacturing of the Jerseys | ||||||
Janitorial supplies used in a factory’s restrooms | x | It Factory Overhead as Janitorial supplies required irrespective of the Production | ||||||
The advertising manager’s salary | x | x | 1. It
is product cost, required to be incurred to sell the product. 2. It is Fixed cost, as the manager will keep on withdrawing the Salary irrespective of the Sales |
|||||
Copy paper to replenish the fax machine in the sales office. | x | Its Period Expenses, as the replenishment depends upon the consumption of the paper |