Chapter 2, Problem 33E

Basic Concepts

For each of the following costs incurred in a manufacturing firm, indicate whether the costs are fixed (F) or variable (V) and whether they are period costs (P) or product costs (M) under full absorption costing:

1. a.       Power to operate factory equipment.
2. b.       Chief financial officer’s salary.
3. c.        Commissions paid to sales personnel.
4. d.       Office supplies for the human resources manager.
5. e.       Depreciation on pollution control equipment in the plant.