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Ch2 Problem 2-38 2-30

Ch2 Problem 2-38 2-30 - 2-28(20 MINUTES 1 Advertising costs...

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2-28 (20 MINUTES) 1. Advertising costs: Period cost, fixed 2. Straight-line depreciation: Product cost, fixed, manufacturing overhead 3. Wages of assembly-line personnel: Product cost, variable, direct labour 4. Delivery costs on customer shipments: Period cost, variable 5. Newsprint consumed: Product cost, variable, direct material 6. Plant insurance: Product cost, fixed, manufacturing overhead 7. Glass costs: Product cost, variable, direct material 8. Tire costs: Product cost, variable, direct material 9. Sales commissions: Period cost, variable 10. Wood glue: Product cost, variable, either direct material or manufacturing overhead (i.e., indirect material) depending on how significant the cost is 11. Wages of refinery security guards: Product cost, variable, manufacturing overhead 12. Salary of financial vice-president: Period cost, fixed 2-30 (15 MINUTES) Number of Muffler Replacements 600 700 800 Total costs: Fixed costs ................................................................. (a) $56,000 $56,000 (b) $56,000 Variable costs ............................................................. (c) 24,000 28,000 (d) 32,000 Total costs ............................................................ (e) $80,000 $84,000 (f) $88,000 Cost per muffler replacement: Fixed cost ................................................................... (g) $ 93.33 * (h) $ 80 (i) $ 70 Variable cost ............................................................... (j) 40.00
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