Product Costs Period Costs Direct Materials Cost Direct Labor Cost Factory Overhead Selling Expense Administrative Expense Cost Cost
The following is a list of costs incurred by several manufacturing companies:
a. Bonus for vice president of marketing
b. Costs of operating a research laboratory
c. Cost of unprocessed milk for a dairy
d.
e. Entertainment expenses for sale representatives
f. Factory supplies
g. First-aid nurse for factory workersh. Health insurance premiums paid for factory workers
i. Hourly wages of warehouse laboresrs
j. Lumber used by furniture manufacturer
k. Maintenance
l. Microprocessors for a microcomputer manufacturer
m. Packing supplies for products sold, which are insignificant to the total cost of the product
n. Paper used by commercial printer
o. Paper used in processing various managerial reports
p. Protective glasses for factory machine operators
q. Salaries of quality control personnel
r. Sales commissions
s. Seed for gain farmer
t. Television advertisment
u. Prebuilt transmissions for an automobile manufacturer
v. Wages of a machine operator on the production line
w. Wages of secretary of company controller
x. Wages of telephone operators for toll-free, customer hotline
Instructions
Classify each of the preceding costs as a product cost or period cost. Indicate whether each product cost is a direct materials cost, a direct labor cost, or a factory overhead cost. Indicate whether each period cost is a selling expense or an administrative expense. Use the following tabular headings for preparing your answer. Pace an "X" in the appropriate column.
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