Question

Required information [The following information applies to the questions displayed below.] Listed here are the total costs associated with the production of 1,000 drum sets manufactured by TrueBeat. The drum sets sell for $431 each. Costs 1. Plastic for casing-$18,000 2. Wages of assembly workers-$87,000 3. Property taxes on factory-$7,000 4. Accounting staff salaries $33,000 5. Drum stands (1,000 stands purchased)-$29,000 6. Rent cost of equipment for sales staff-$24,000 7. Upper management salaries-$135,000 8. Annual flat fee for factory maintenance service-$13,000 9. Sales commissions-$16 per unit 10. Machinery depreciation, straight-line-$41,000 Required: 1. Classify each cost and its amount as (a) either variable or fixed and (b) either product or period. (The first cost is completed as an example.)

Answer 1

LiS ted here are Uctassify each cost oSt by fuCtion Peय०व fixea cost by behavios COSTS variable Fixed Voaiable 1 Plastic Eo3 casing 5 18000 Rwageofassembly wokes T000 8t000 Paopety tax on facto ACCounting staffsala1e 1000 +000 4 33000 33000 Dnum stands 29000 29000 6 Rent cost of Equip for salestaGE 24000 R4000 UPpel managemenf salane 13 5000 13 5000 8 Annyal fICt fee by Fac.ma 13000 13000 sale commission 10 mach der-staaight Iine 16000 S 16000 41000 41000 sales commission $16X 1000 $ 16000

TaleBeat calculation Of manufacNaing cost pe Daum set TOral cost pesonitcos Item Naria61e pdction costs plastic feO casing 18000 wage of assembly 0kers 8T000 29000 29 Dau ttand TOral variable PauducHOn cost 134000 $134 EIxed padu cton co Sts PaOpesty axe on fe ctory 4000 Annual fees for mcintenane seruice 13000 41000 13 machinary depriatron 41 TOTOL FiXed production cost 61000 TOTAL Producton cost F195000 195 Pes unft COSt TOTCH CO St 1000 drm set