Chapter 1, Problem 1.17E

To determine

Introduction:

Importance of cost classification: Cost accounting is a vast subject and in that cost, classification plays a major role. Until and unless the costs are classified properly, its accounting will not be accurate. So, it is a very important process in cost accounting. It is important for managers as it helps in decision-making and controls departmental costs for efficient management.

To classify: The costs based on their cost behavior and applicability for preparing financial statements.