Classify costs
Seymour Clothing Co. manufactures a variety of clothing types for distribution to several major retail chains. The following costs are incurred in the production and sale of blue jeans:
Shipping boxes used to ship orders
Consulting fee of $200,000 paid to industry specialist for marketing advice
Straight-line
Salesperson's salary, $10,000 plus 2% of the total sales
Fabric
Dye
Thread
Salary of designers
Brass buttons
Legal fees paid to attorneys in defense of the company in a patent infringement suit, $50,000 plus $87 per hour
Insurance premiums on property, plant, and equipment, $70,000 per year plus $5 per $30,000 of insured value over $8,000,000
Rental costs of warehouse, $5,000 per month plus $4 per square foot of storage used
Supplies
Leather for patches identifying the brand on individual pieces of apparel
Rent on plant equipment, $50,000 per year
Salary of production vice president
Janitorial services, $2,200 per month
Wages of machine operators
Electricity costs of $0.10 per kilowatt-hour
Property taxes on property, plant, and equipment
Instructions
Classify the preceding costs as either fixed, variable, or mixed. Use the following tabular headings and place an X in the appropriate column. Identify each cost by letter in the cost column.
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