Identifying product costs and period costs Classify each cost of a paper manufacturer as either product cost or period cost: Salaries of scientists studying ways to speed forest growth. Cost of computer software to track WIP Inventory. Cost of electricity at the paper mill. Salaries of the company’s top executives. Cost of chemicals to treat the paper. Cost of TV ads. Depreciation on the manufacturing plant. Cost to purchase wood pulp. Life insurance on the CEO.

Identifying product costs and period costs Classify each cost of a paper manufacturer as either product cost or period cost: Salaries of scientists studying ways to speed forest growth. Cost of computer software to track WIP Inventory. Cost of electricity at the paper mill. Salaries of the company’s top executives. Cost of chemicals to treat the paper. Cost of TV ads. Depreciation on the manufacturing plant. Cost to purchase wood pulp. Life insurance on the CEO.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter2: Building Blocks Of Managerial Accounting

Section: Chapter Questions

Problem 4PA: Listed as follows are various costs found in businesses. Classify each cost as a fixed or variable...

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Identifying product costs and period costs Classify each cost of a paper manufacturer as either product cost or period cost: a. Salaries of scientists studying ways to speed forest growth. b. Cost of computer software to track WIP Inventory. c. Cost of electricity at the paper mill. d. Salaries of the company’s top executives. e. Cost of chemicals to treat the paper. f. Cost of TV ads. g. Depreciation on the manufacturing plant. h. Cost to purchase wood pulp. i. Life insurance on the CEO.
Classify each of the following costs as manufacturing or non manufacturing: 1. Factory rental 2. Interest on bank overdraft 3. Depreciation on warehouse equipment 4. Salary and bonus for the chief accountant 5. Wages of security guards in factory 6. Advertising 7. Property taxes on corporate headquarters building 8. Gas and electricity for the factory 9. Carriage on purchase of raw materials 10. Operators of product help lines for customers
Listed as follows are various costs found in businesses. Classify each cost as a fixed or variable cost, and as a product and/or period cost. a. Wages of administrative staff b. Shipping costs on merchandise sold C. Wages of workers assembling computers d. Cost of lease on factory equipment e. Insurance on factory f. Direct materials used in production of lamps g. Supervisor salary, factory h. Advertising costs_ i. Property taxes, factory j. Health insurance cost for company executives k. Rent on factory
Which of the following are parts S,G&A for General Motors? Cost of purchasing assembly line robots Cost of steel and aluminum Salaries of workers on assembly line Salaries of marketing/advertising people Interest expense on bonds Cost of insurance for headquarters Federal income tax Salary of CFO
E. Identify which of the following costs of a product manufacturer would be included in inventories: • Salaries of assembly line workers • Raw materials • Salary of factory foreman ● Heating cost for the factory • Miscellaneous supplies used in production process ● Salary of the CEO • Costs to ship raw materials from the supplier to the factory • Electricity cost for the factory • Salaries of the sales team Depreciation of factory machines Property taxes on factory building • Discounts for early payment of raw material purchases • Salaries of the factory's janitorial staff ● ●
Following are selected costs of a company that manufactures computer chips. Classify each as either a product cost or a period cost. Then classify each of the product costs as direct material, direct labor, or overhead. 1. Plastic boards used to mount chips 2. Advertising costs 3. Factory maintenance workers’ salaries 4. Real estate taxes paid on the sales office 5. Real estate taxes paid on the factory 6. Factory supervisor salary 7. Depreciation on factory equipment 8. Assembly worker hourly pay to make chips
which of the following is a product cost for a manufacturing company : a- insurance on the corporate headquarters building b- property taxes on a factory c- depreciation on a salesperson vehicle d- the salary of a sales manager
Who among the following is not a cost of a product? The expense of the company's fuel. The cost of power at the manufacturing foreman's office Depreciation on the company's installed plant The price of delivering finished goods to clients.
Identify which of the following transactions andevents are product costs and which are period costs:• Office fire insurance.• Cost of electric power.• Rental charges of warehouses.• Costs of basic raw materials used in production.• Depreciation of electrical equipment in the plant.• Depreciation of the furniture in the office.• Sales incentives paid to the sales personnel.• Inspection costs of raw materials.• Direct overhead costs.• Costs of packing materials.• Overtime premiums.
The following is a list of costs incurred by several businesses:a. Cost of fabric used by clothing manufacturerb. Maintenance and repair costs for factory equipmentc. Rent for a warehouse used to store raw materials and work in processd. Wages of production quality control personnele. Oil lubricants for factory plant and equipmentf. Depreciation of robot used to assemble a productg. Travel costs of marketing executives to annual sales meetingh. Depreciation of copying machines used by the Marketing Departmenti. Fees charged by collection agency on past-due customer accountsj. Electricity used to operate factory machineryk. Maintenance costs for factory equipmentl. Pens, paper, and other supplies used by the Accounting Department in preparing various managerial reportsm. Charitable contribution to United Fundn. Depreciation of microcomputers used in the factory to coordinate and monitor the production scheduleso. Fees paid to lawn service for office grounds upkeepp. Cost of sewing…
Which of the following costs would be considered a period rather than a product cost in a manufacturing company? Manufacturing equipment depreciation. Property taxes on corporate headquarters. Direct materials costs. Electrical costs to light the production facility.
organization. 47. Which of the following is an example of a direct cost an organization might incur in producing a product? a. The cost of the raw materials that go into the product b. The rent paid the facility where the product is produced The utility bills, such as the cost of electricity and water d. The wages paid to employees c. futuror opened an automotive assembly plant in San