E1-5 Cost classification Classify the following as direct materials, direct labor, factory over- head, or selling and administrative expense. a. Steel used in an overhead door plant. b. Cloth used in a shirt factory. c. Fiberglass used by a sailboat builder. d. Cleaning solvent for the factory floor. e. Wages of a binder employed in a printing plant. f. Insurance on factory machines. g. Rent paid for factory buildings. h. Wages of the Machining Department supervisor. i. Leather used in a shoe factory. j. Wages of a factory janitor. k. Electric power consumed in operating factory machines. I. Depreciation on corporate offices.

E1-5 Cost classification Classify the following as direct materials, direct labor, factory over- head, or selling and administrative expense. a. Steel used in an overhead door plant. b. Cloth used in a shirt factory. c. Fiberglass used by a sailboat builder. d. Cleaning solvent for the factory floor. e. Wages of a binder employed in a printing plant. f. Insurance on factory machines. g. Rent paid for factory buildings. h. Wages of the Machining Department supervisor. i. Leather used in a shoe factory. j. Wages of a factory janitor. k. Electric power consumed in operating factory machines. I. Depreciation on corporate offices.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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(b) Classify whether the items below refer to direct material cost (DM), direct labour cost (DL), or production overhead cost (POH). (i) (ii) (iii) (iv) Wages of production line workers. Maintenance of machineries. Purchase of direct materials. Purchase of loose tools. (v) (vi) (vii) Wages of factory supervisor. (viii) Depreciation on plant. (ix) Lubricating oil for machine. Hire of special machine. (x) Freight charges on direct materials. Factory light and power.
Identify whether the following items should be included in Direct Materials (DM), Direct Labor (DL), Manufacturing Overhead (MO) or Period Costs (PC) (a) Assembly line wages (b) Raw materials used directly in product (c) Depreciation on office equipment (d) Property taxes on factory building (e) Rent on factory building (f) Sales commissions (g) Depreciation on factory equipment (h) Factory utilities (i) Wages for factory maintenance workers 0) Advertising (k) Indirect materials used in production (1) Factory manager's salary
E1-5 Cost classificationClassify the following as direct materials, direct labor, factory overhead, or selling and administrative expense.a. Steel used in an overhead door plant.b. Cloth used in a shirt factory.c. Fiberglass used by a sailboat builder.d. Cleaning solvent for the factory floor.e. Wages of a binder employed in a printing plant.f. Insurance on factory machines.g. Rent paid for factory buildings.h. Wages of the Machining Department supervisor.i. Leather used in a shoe factory.j. Wages of a factory janitor.k. Electric power consumed in operating factory machines.l. Depreciation on corporate offices.Similar toRecall and Review 2Similar toRecall and Review 1LO1LO1LO3LO3LO4Chapter 1—Introduction to Cost Accounting 53Copyright 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).Editorial review has deemed that any…
Below is a table showing the various costs incurred by various companies. In each column, indicate the proper classification and explanation of these costs. Write NA if not applicable. Costs Manufacturing (M) or Non-Manufacturing (NM) Direct Materials (DM), Direct Labor (DL) or Factory Overhead (FOH) General and Administrative (GA) or Marketing and Selling (MS) j. Salaries of plant supervisor k. Interest on bank loan l. Property tax on the production plant
1 For a manufacturing company, which of the following is an example of a period cost rather thana product cost? a. Depreciation on factory equipment b. Wages of salespersons c. Wages of machine operators d. Insurance on factory equipment
For a manufacturing company, which of the following is an example of a period cost rather than a product cost? a. Depreciation on factory equipment b. Advertising expense c. Wages of machine operators d. Insurance on factory equipment
Which of the following is not classified as a factory overhead cost? a. Electricity to run factory machines b. Insurance to protect the factory materials c. Salary of security guards that protect the factory building d. Advertising cost to promote the finished goods
An example of a period cost isa. the salary of a production supervisor.b. the raw materials used in production.c. the property taxes on a factory building.d. advertising and promotion expenditures.e. none of the above.
Required: Classify the following costs as period or traceable costs. Depreciation on office building Insurance expense for factory building Product liability insurance premium Transportation charges for raw materials Factory repairs and maintenance Rent for inventory warehouse Cost of raw materials Factory wages Salary to chief executive officer Depreciation on factory Bonus to factory workers Salary to marketing staff Administrative expenses Bad debt expense Advertising expense Research and development Warranty expense Electricity for plant
Indicate whether each of the following costs of a pencil manufacturer would be classified as direct materials (DM), direct labor (DL), or manufacturing overhead (MO).a. ____ Depreciation of pencil painting machineryb. ____ Lead inserted into pencilsc. ____ Factory utilitiesd. ____ Wages of assembly line workere. ____ Salary of supervisorf. ____ Factory machinery maintenanceg. ____ Woodh. ____ Eraser compound
Which of the following items would be classified as part of factory overhead? a. amortization of manufacturing patents b. factory supplies used c. production supervisors' salaries Od. all of these choices
Which one of the following is an example of a period cost? Maintenance on factory machines O Wages of factory workers O Property Tax on Factory O Property tax on Adm. Building