The following calendar year-end information is taken from the December 31, 2019, adjusted trial balance and other records of Best Bikes. Advertising expense $ 20,250 Depreciation expense—Office equipment . 8,440 Depreciation expense—Selling equipment 10,125 Depreciation expense—Factory equipment 35,400 Factory supervision 121,500 Factory supplies used (indirect materials) . 6,060 Factory utilities 37,500 Direct labor 562,500 Indirect labor . 59,000 Miscellaneous production costs $ 8,440 Office salaries expense . . . . . . . . . . . . . . . . . . . . 70,875 Raw materials purchases (direct materials) . 894,375 Rent expense—Office space 23,625 Rent expense—Selling space 27,000 Rent expense—Factory building 93,500 Maintenance expense—Factory equipment . 30,375 Sales 4,942,625 Sales salaries expense . 295,300 Required 1. Classify each cost as either a product or period cost. 2. Classify each product cost as either direct materials, direct labor, or factory overhead. 3. Classify each period cost as either selling expenses or general and administrative expenses.
The following calendar year-end information is taken from the December 31, 2019, adjusted
and other records of Best Bikes. Advertising expense $ 20,250
Depreciation expense—Selling equipment 10,125
Depreciation expense—Factory equipment 35,400
Factory supervision 121,500
Factory supplies used (indirect materials) . 6,060
Factory utilities 37,500
Direct labor 562,500
Indirect labor . 59,000
Miscellaneous production costs $ 8,440
Office salaries expense . . . . . . . . . . . . . . . . . . . . 70,875
Raw materials purchases (direct materials) . 894,375
Rent expense—Office space 23,625
Rent expense—Selling space 27,000
Rent expense—Factory building 93,500
Maintenance expense—Factory equipment . 30,375
Sales 4,942,625
Sales salaries expense . 295,300 Required
1. Classify each cost as either a product or period cost.
2. Classify each product cost as either direct materials, direct labor, or factory
3. Classify each period cost as either selling expenses or general and administrative expenses.
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