Product Period Cost DM DL MOH Prime Conversion Selling Admin. a. Metal used for rims х х b. Sales salaries c. Rent on factory d. Wages of assembly workers e. Salary of production supervisor f. Depreciation on office equipment g. Salary of CEo h. Delivery expense

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Classifying costs

Wheels, Inc. manufactures wheels for bicycles, tricycles, and scooters. For each cost given below, determine if the cost is a product cost or a period cost. If the cost is a product cost, further determine if the cost is direct materials (DM), direct labor (DL), or manufacturing overhead (MOH) and then determine if the product cost is a prime cost, conversion cost, or both. If the cost is a period cost, further determine if the cost is a selling expense or administrative expense (Admin). Cost (a) is answered as a guide

Product
Period
Cost
DM
DL
MOH Prime Conversion Selling Admin.
a. Metal used for rims
х
х
b. Sales salaries
c. Rent on factory
d. Wages of assembly
workers
e. Salary of production
supervisor
f. Depreciation on
office equipment
g. Salary of CEo
h. Delivery expense
Transcribed Image Text:Product Period Cost DM DL MOH Prime Conversion Selling Admin. a. Metal used for rims х х b. Sales salaries c. Rent on factory d. Wages of assembly workers e. Salary of production supervisor f. Depreciation on office equipment g. Salary of CEo h. Delivery expense
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