Classify Costs Seymour Clothing Co. manufactures a variety of clothing types for distribution to several major retail chains. The following costs are incurred in the production and sale of blue jeans: Required: Identify each cost listed below as variable costs, fixed costs, or mixed cost. A. Shipping boxes used to ship orders B. Consulting fee of $200,000 paid to industry specialist for marketing advice C. Straight-line depreciation on sewing machines D. Salesperson's salary, $10,000 plus 2% of the total sales E. Fabric F. Dye G. Thread H. Salary of designers I. Brass buttons J. Legal fees paid to attorneys in defense of the company in a patent infringement suit, $50,000 plus $87 per hour K. Insurance premiums on property, plant, and equipment, $70,000 per year plus $5 per $30,000 of insured value over $8,000,000 L. Rental costs of warehouse, $5,000 per month plus $4 per square foot of storage used M. Supplies N. Leather for patches identifying the brand on individual pieces of apparel O. Rent on plant equipment, $50,000 per year P. Salary of production vice president Q. Janitorial services, $2,200 per month R. Wages of machine operators S. Electricity costs of $0.10 per kilowatt-hour T. Property taxes on property, plant, and equipment
Classify Costs Seymour Clothing Co. manufactures a variety of clothing types for distribution to several major retail chains. The following costs are incurred in the production and sale of blue jeans: Required: Identify each cost listed below as variable costs, fixed costs, or mixed cost. A. Shipping boxes used to ship orders B. Consulting fee of $200,000 paid to industry specialist for marketing advice C. Straight-line depreciation on sewing machines D. Salesperson's salary, $10,000 plus 2% of the total sales E. Fabric F. Dye G. Thread H. Salary of designers I. Brass buttons J. Legal fees paid to attorneys in defense of the company in a patent infringement suit, $50,000 plus $87 per hour K. Insurance premiums on property, plant, and equipment, $70,000 per year plus $5 per $30,000 of insured value over $8,000,000 L. Rental costs of warehouse, $5,000 per month plus $4 per square foot of storage used M. Supplies N. Leather for patches identifying the brand on individual pieces of apparel O. Rent on plant equipment, $50,000 per year P. Salary of production vice president Q. Janitorial services, $2,200 per month R. Wages of machine operators S. Electricity costs of $0.10 per kilowatt-hour T. Property taxes on property, plant, and equipment
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter6: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 1PA: Classify costs Seymour Clothing Co. manufactures a variety of clothing types for distribution to...
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Classify Costs
Seymour Clothing Co. manufactures a variety of clothing types for distribution to several major retail chains. The following costs are incurred in the production and sale of blue jeans:
Required:
Identify each cost listed below as variable costs, fixed costs, or mixed cost.
A. Shipping boxes used to ship orders | |
B. Consulting fee of $200,000 paid to industry specialist for marketing advice | |
C. Straight-line depreciation on sewing machines | |
D. Salesperson's salary, $10,000 plus 2% of the total sales | |
E. Fabric | |
F. Dye | |
G. Thread | |
H. Salary of designers | |
I. Brass buttons | |
J. Legal fees paid to attorneys in defense of the company in a patent infringement suit, $50,000 plus $87 per hour | |
K. Insurance premiums on property, plant, and equipment, $70,000 per year plus $5 per $30,000 of insured value over $8,000,000 | |
L. Rental costs of warehouse, $5,000 per month plus $4 per square foot of storage used | |
M. Supplies | |
N. Leather for patches identifying the brand on individual pieces of apparel | |
O. Rent on plant equipment, $50,000 per year | |
P. Salary of production vice president | |
Q. Janitorial services, $2,200 per month | |
R. Wages of machine operators | |
S. Electricity costs of $0.10 per kilowatt-hour | |
T. Property taxes on property, plant, and equipment |
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