EX 18-8 Classifying costs The following report was prepared for evaluating the performance of the plant manager of Farrar Inc. Evaluate and correct this report. A Buku Accounting 25 Edition-Carl S. Warren, James M. Reeve, Jonathan E. Duchac-Cengage Learning-2014.pdf - Adobe Acrobat Reader DC (32-bit)File Edit Vievw Sign Window HelpHomeToolsBuku Accounting 2. xSign In857 (899 of 1375)75%TII pra IAnagers asaiary wounU DE COISIOCICU (uncc, muncc U u prouuct.g. An example of factory overhead is (sales office depreciation, plant depreciation).Search 'Compress size'EX 18-7 Classifylng costs In a service companyA partial list of the costs for Wisconsin and Minnesota Railroad, a short hauler of freight,is provided below. Classify each cost as either indirect or direct. For purposes of clas-sifying each cost, use the train as the cost object.OBJ. 2LO Export PDFa. Cost to lease (rent) train locomotivesb. Salaries of dispatching and communications personnelAdobe Export PDFc. Costs of accident cleanupd. Wages of switch and classification yard personnele. Cost of track and bed (ballast) replacementConvert PDF Files to Wordor Excel Onlinef. Wages of train engineersg. Payroll clerk salariesSelect PDF Fileh. Safety training costsi. Fuel costsBuku Acco.g-2014.pdf XMaintenance costs of right of way, bridges, and buildingsk. Cost to lease (rent) railroad cars1. Depreciation of terminal facilitiesConvert toEX 18-8 Classifying costsов). 2, 3Microsoft Word (".docx)The following report was prepared for evaluating the performance of the plant managerof Farrar Inc. Evaluate and correct this report.Document Language:Farrar Inc.Manufacturing CostsFor the Quarter Ended June 30, 2014English (U.S.) ChangeMaterials used in production (including$62,500 of indirect materials)$ 675,000625,000............Direct labor (including $93,750 maintenance salaries).Factory overhead:Supervisor salaries .....Heat, light, and power..Sales salaries .......Promotional expenses.575,000156,250387,500350,000168,750243,750137,500Convert, edit and e-sign PDFforms & agreementsInsurance and property taxes-plantInsurance and property taxes-corporate officesDepreciation-plant and equipmentDepreciation-corporate offices100,000$3,418,750Free 7-Day TrialTotal......................Capyright 2012 Ceage Laing All Rgta Raaval May not be caplat, nal, or duplicald in wtole or in put. Du io cledmaic dat me ihind puty conint may be upenad from he cliook ander dupter. idatal noviow hdmed hui y pondctent do n mtally aflad the oval leming aperiama. Cene laming rva te ngho e addticnal aientany imif att dyta ratrictioe mi7:35LINEENG12L7725/02/2021近

Question

EX 18-8 Classifying costs The following report was prepared for evaluating the performance of the plant manager of Farrar Inc. Evaluate and correct this report. A Buku Accounting 25 Edition-Carl S. Warren, James M. Reeve, Jonathan E. Duchac-Cengage Learning-2014.pdf - Adobe Acrobat Reader DC (32-bit)File Edit Vievw Sign Window HelpHomeToolsBuku Accounting 2. xSign In857 (899 of 1375)75%TII pra IAnagers asaiary wounU DE COISIOCICU (uncc, muncc U u prouuct.g. An example of factory overhead is (sales office depreciation, plant depreciation).Search 'Compress size'EX 18-7 Classifylng costs In a service companyA partial list of the costs for Wisconsin and Minnesota Railroad, a short hauler of freight,is provided below. Classify each cost as either indirect or direct. For purposes of clas-sifying each cost, use the train as the cost object.OBJ. 2LO Export PDFa. Cost to lease (rent) train locomotivesb. Salaries of dispatching and communications personnelAdobe Export PDFc. Costs of accident cleanupd. Wages of switch and classification yard personnele. Cost of track and bed (ballast) replacementConvert PDF Files to Wordor Excel Onlinef. Wages of train engineersg. Payroll clerk salariesSelect PDF Fileh. Safety training costsi. Fuel costsBuku Acco.g-2014.pdf XMaintenance costs of right of way, bridges, and buildingsk. Cost to lease (rent) railroad cars1. Depreciation of terminal facilitiesConvert toEX 18-8 Classifying costsов). 2, 3Microsoft Word (&#34;.docx)The following report was prepared for evaluating the performance of the plant managerof Farrar Inc. Evaluate and correct this report.Document Language:Farrar Inc.Manufacturing CostsFor the Quarter Ended June 30, 2014English (U.S.) ChangeMaterials used in production (including$62,500 of indirect materials)$ 675,000625,000............Direct labor (including $93,750 maintenance salaries).Factory overhead:Supervisor salaries .....Heat, light, and power..Sales salaries .......Promotional expenses.575,000156,250387,500350,000168,750243,750137,500Convert, edit and e-sign PDFforms & agreementsInsurance and property taxes-plantInsurance and property taxes-corporate officesDepreciation-plant and equipmentDepreciation-corporate offices100,000$3,418,750Free 7-Day TrialTotal......................Capyright 2012 Ceage Laing All Rgta Raaval May not be caplat, nal, or duplicald in wtole or in put. Du io cledmaic dat me ihind puty conint may be upenad from he cliook ander dupter. idatal noviow hdmed hui y pondctent do n mtally aflad the oval leming aperiama. Cene laming rva te ngho e addticnal aientany imif att dyta ratrictioe mi7:35LINEENG12L7725/02/2021近

Accepted Answer

There are two types of cost, they are

Direct cost- those costs that incurred which are directly…