Please help me determine each item on the attached list as either direct material, direct labor, overhead or period costs.
Transcribed Image Text:Milestone One - Cost Classification
INSTRUCTIONS:
Putting an X in the appropriate spot, classify the costs as: Direct Material, Direct Labor, Overhead, or Period Costs.
The Fixed and Variable cost classifications have been provided for you.
Direct
Direct
Item/Cost
Material
Labor
Overhead
Period Costs
Fixed
Variable
Salary - Collar maker
Salary - Leash maker
Salary - Harness maker
Salary - Receptionist
High-tensile strength nylon webbing
Polyester/nylon ribbons
Buckles made of cast hardware
Depreciation on sewing machines
Rent
Utilities and insurance
Scissors, thread, and cording
Price tags
Office supplies
Oter business equipment
Loan payment
Salary to self
Definition Definition Indirect costs incurred while producing goods or services. Overhead costs cannot be directly attributed to products or services. Overhead includes indirect material cost, indirect labor cost, rent, utilities expenses, and depreciation. Since these costs directly affect the profitability of a company, managing overhead becomes an important task for management.
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