Question

Below are various costs items that maybe found in organizations: (14 marks) i. ii. iii. iv. v. vi. vii. The salary of the manager in charge of production at BlackBerry. Salespeople's commissions at Avon Products, a company that sells cosmetics door to door. Insurance on one of Bombardier's factory buildings. Depreciation on the photocopier in the accounting department. The costs of X-ray film at the Toronto General Hospital's radiology lab. The depreciation on the playground equipment at a McDonald's restaurant. The cost of mozzarella cheese used at a Pizza Hut outlet. Required: For each of the cost items identify the type of cost by placing an X in the appropriate category. Note: a cost item could belong to more than one category. Selling and Cost Behaviour Administrative Product Cost Item Variable Fixed Cost Cost 1. Salary of production manager at Blackberry 2. Salesperson's commissions at Avon Products ..................... 3. Insurance on one of Bombardier's factory buildings .............. 4. Depreciation on the photo copier ................................. 5. The costs of X-ray film at the Toronto General's radio- logy lab............ 6. The depreciation on the playground equipment at a McDonald's outlet .............. 7. The cost of the mozzarella cheese used at a Pizza Hut outlet .............

Answer 1

Cost Item	Cost Behaviour		Selling and Administrative Cost	Product Cost
	Variable	Fixed
1. Salary of production manager at Blackberry		Fixed		Product cost
2. Salesperson's commission at Avon products.	Variable		Selling and Administrative Cost
3. Insurance of one of Bombardier's factory buildings.		Fixed		Product cost
4. Depreciation on photo copier	Variable		Selling and Administrative Cost
5. The costs of X-ray film at the Toronto General's radiology lab.	Variable			Product cost
6. The depreciation on the playground equipment at a McDonald's outlet		Fixed	Selling and Administrative Cost
7. The cost of the mozzarella cheese used at a Pizza Hut outlet.	Variable			Product cost

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