Question

Question 1: Product and perlod costs a) In a manufacturing firm, product costs Include: O all variable costs O all non-manufacturing costs O all fixed costs O all manufacturing costs O all GAAP costs period costs include: O all variable costs O all non-manufacturing costs O all manufacturing costs O all non-GAAP costs O all fixed costs b) Classify the following items as product or period costs: Rent for the factory building Rent for the sales office Depreciation on production equipment Depreciation on sales office equipment Production supervisor's salary Marketing manager's salary Assembly workers' wages Materials used in production Office supplies used in the customer service department product product Operiod Oproduct Operiod product Operiod product Operiod product Operiod product period product period product period period

Answer 1

a. all manufacturing costs, these costs are direct costs for example direct material , direct labor, manufacturing overhead and more

b. all non-manufacturing costs,, these costs are indirect costs for example rent expense, fixed selling and administrative expenses, depreciation and more

c. 1) product cost , factory is being used to manufacture goods

2) period cost , sales office is not a manufacturing place

3) product cost , production equipment is being used to manfacture goods

4) period cost , sales office equipment is not being used to manfacture goods

5) product cost , production supervisor's salary is direct cost

6) period cost , marketing manager's supervisor's salary is indirect cost

7) product cost , workers wages are direct cost

8)   product cost , material used are manufacturing costs

9)   period cost , office supplies are not related to manufacturing cost