Chapter 2, Problem 2.4SE

Classify costs as direct or indirect (Learning Objective 3)

Classify each of the following costs as a direct cost or an indirect cost, assuming that the cost object is the Juniors Department (clothing and accessories for teenage and young women) in the Stow Kohl’s department store. (Kohl’s is a chain of department stores and has stores located across the United States.)

1. a. Juniors Department sales clerks
2. b. Cost of Juniors clothing
3. c. Cost of hangers used to display the clothing in the store
4. d. Electricity for the building
5. e. Cost of radio advertising for the store
6. f. Juniors clothing buyers’ salaries (these buyers buy for all the Juniors Departments of Kohl’s stores)
7. g. Depreciation of the building
8. h. Cost of costume jewelry on the mannequins in the Juniors Department
9. i. Cost of bags used to package customer purchases at the main registers for the store
10. j. The Stow Kohl’s store manager’s salary
11. k. Cost of the security staff at the Stow store
12. l. Manager of Juniors Department