Classify Costs Following is a list of various costs incurred in producing replacement automobile parts. With respect to the production and sale of these auto parts, classify each cost as either variable costs, fixed costs, or mixed costs. 1. Oil used in manufacturing equipment 2. Plastic 3. Property taxes, $165,000 per year on factory building and equipment 4. Salary of plant manager 5. Cost of labor for hourly workers 6. Packaging 7. Factory cleaning costs, $6,000 per month 8. Metal 9. Rent on warehouse, $10,000 per month plus $25 per square foot of storage used 10. Property insurance premiums, $3,600 per month plus $0.01 for each dollar of property over $1,200,000 11. Straight-line depreciation on the production equipment 12. Hourly wages of machine operators 13. Electricity costs, $0.20 per kilowatt-hour 14. Computer chip (purchased from a vendor) 15. Pension cost, $1.00 per employee hour on the job
Classify Costs Following is a list of various costs incurred in producing replacement automobile parts. With respect to the production and sale of these auto parts, classify each cost as either variable costs, fixed costs, or mixed costs. 1. Oil used in manufacturing equipment 2. Plastic 3. Property taxes, $165,000 per year on factory building and equipment 4. Salary of plant manager 5. Cost of labor for hourly workers 6. Packaging 7. Factory cleaning costs, $6,000 per month 8. Metal 9. Rent on warehouse, $10,000 per month plus $25 per square foot of storage used 10. Property insurance premiums, $3,600 per month plus $0.01 for each dollar of property over $1,200,000 11. Straight-line depreciation on the production equipment 12. Hourly wages of machine operators 13. Electricity costs, $0.20 per kilowatt-hour 14. Computer chip (purchased from a vendor) 15. Pension cost, $1.00 per employee hour on the job
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Classify Costs
Following is a list of various costs incurred in producing replacement automobile parts. With respect to the production and sale of these auto parts, classify each cost as either variable costs, fixed costs, or mixed costs.
| 1. Oil used in manufacturing equipment | |
| 2. Plastic | |
| 3. Property taxes, $165,000 per year on factory building and equipment | |
| 4. Salary of plant manager | |
| 5. Cost of labor for hourly workers | |
| 6. Packaging | |
| 7. |
|
| 8. Metal | |
| 9. Rent on warehouse, $10,000 per month plus $25 per square foot of storage used | |
| 10. Property insurance premiums, $3,600 per month plus $0.01 for each dollar of property over $1,200,000 | |
| 11. Straight-line |
|
| 12. Hourly wages of machine operators | |
| 13. Electricity costs, $0.20 per kilowatt-hour | |
| 14. Computer chip (purchased from a vendor) | |
| 15. Pension cost, $1.00 per employee hour on the job |
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