Classify each cost as either a product cost or a period cost. Indicate whether each product cost is a direct materials cost, a direct labor cost, or a factory Indicate whether each period cost is a selling expense or an administrative expense. Costs a. Annual bonus paid to the chief financial officer of the company b. Annual fee to a celebrity to promote the aircraft c. Cost of electronic guidance system installed in the airplane cockpit d. Cost of the flight data recorder (the black box) for the airplane e. Cost of normal scrap from production of the airplane body f. Cost of small replicas of the airplane used to promote and market the airplane g. Cost of paving the headquarters employee parking lot h. Decals for cockpit door, the cost of which is immaterial to the cost of the final product 1. Depreciation on factory equipment j. Hourly wages for janitorial staff for the factory k. Hydraulic pumps used in the airplane's flight control system 1. Instrument panel installed in the airplane cockpit m. Interior trim material used throughout the airplane cabin Classification

Classify each cost as either a product cost or a period cost. Indicate whether each product cost is a direct materials cost, a direct labor cost, or a factory Indicate whether each period cost is a selling expense or an administrative expense. Costs a. Annual bonus paid to the chief financial officer of the company b. Annual fee to a celebrity to promote the aircraft c. Cost of electronic guidance system installed in the airplane cockpit d. Cost of the flight data recorder (the black box) for the airplane e. Cost of normal scrap from production of the airplane body f. Cost of small replicas of the airplane used to promote and market the airplane g. Cost of paving the headquarters employee parking lot h. Decals for cockpit door, the cost of which is immaterial to the cost of the final product 1. Depreciation on factory equipment j. Hourly wages for janitorial staff for the factory k. Hydraulic pumps used in the airplane's flight control system 1. Instrument panel installed in the airplane cockpit m. Interior trim material used throughout the airplane cabin Classification

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Manufacturing Costs

Manufacturing cost is the total cost of procuring or producing a product. In other words, the manufacturing cost is the cost that an individual or business owner undertakes for the manufacturing of goods.

Question

Classify each cost as either a product cost or a period cost. Indicate whether each product cost is a direct materials cost, a direct labor cost, or a factory
Indicate whether each period cost is a selling expense or an administrative expense.
Costs
a. Annual bonus paid to the chief financial officer of the company
b. Annual fee to a celebrity to promote the aircraft
c. Cost of electronic guidance system installed in the airplane cockpit
d. Cost of the flight data recorder (the black box) for the airplane
e. Cost of normal scrap from production of the airplane body
f. Cost of small replicas of the airplane used to promote and market the airplane
g. Cost of paving the headquarters employee parking lot
h. Decals for cockpit door, the cost of which is immaterial to the cost of the final product
1. Depreciation on factory equipment
j. Hourly wages for janitorial staff for the factory
k. Hydraulic pumps used in the airplane's flight control system
1. Instrument panel installed in the airplane cockpit
m. Interior trim material used throughout the airplane cabin
n. Masks for use by painters in painting the airplane body
o. Metal used for producing the airplane body
p. Oil to lubricate factory equipment
q. Power used by painting equipment
r. Prebuilt leather seats installed in the first-class cabin
s. Production Quality Control Department costs for the year
Classification

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