Various costs associated with the operation of factories are given below:1. Electricity to run production equipment.2. Rent on a factory building.3. Cloth used to make drapes.4. Production superintendent’s salary.5. Wages of laborers assembling a product.6. Depreciation of air purification equipment used to make furniture.7. Janitorial salaries.8. Peaches used in canning fruit.9. Lubricants for production equipment.10. Sugar used in soft-drink production.11. Property taxes on the factory.12. Wages of workers painting a product.13. Depreciation on cafeteria equipment.14. Insurance on a building used in producing helicopters.15. Cost of rotor blades used in producing helicopters.Required:Classify each cost as either variable or fixed with respect to the number of units produced and sold. Alsoindicate whether each cost would typically be treated as a direct cost or an indirect cost with respect tounits of product.
Various costs associated with the operation of factories are given below:
1. Electricity to run production equipment.
2. Rent on a factory building.
3. Cloth used to make drapes.
4. Production superintendent’s salary.
5. Wages of laborers assembling a product.
6.
7. Janitorial salaries.
8. Peaches used in canning fruit.
9. Lubricants for production equipment.
10. Sugar used in soft-drink production.
11. Property taxes on the factory.
12. Wages of workers painting a product.
13. Depreciation on cafeteria equipment.
14. Insurance on a building used in producing helicopters.
15. Cost of rotor blades used in producing helicopters.
Required:
Classify each cost as either variable or fixed with respect to the number of units produced and sold. Also
indicate whether each cost would typically be treated as a direct cost or an indirect cost with respect to
units of product.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 1 images
