Appalachian Crafts, Inc., manufactures furniture, including tables. Many differe

Question

Appalachian Crafts, Inc., manufactures furniture, including tables. Many different costs are incurred in the production of tables. Some of these costs are listed below. Cost Description Variable Fixed Period Product DM DL MOH Wood used in the table Wages of workers who assemble the tables Factory supervisor who oversees the assembly workers Electricity used in factory to run machines Depreciation on factory machines Company president's salary Advertising expense Sales commissions paid on each table sold Liability insurance for factory operations Depreciation on chairs and tables in factory lunchroom Toner and ink for photocopy machine used by Accounting Disposable gloves used by assembly workers Lubricant used for maintenance of machines Cost of shipping tables to customers Sandpaper used to prep wood for painting Rent on rooms at a Las Vegas hotel for annual sales conference Required: 1. Identify each cost as fixed or variable in relation to each table produced. 2. Identify each cost as a period or product (table) cost. Appalachian Crafts, Inc., manufactures furniture, including tables. Many different costs are incurred in the production of tables. Some of these costs are listed below. Cost Description Variable Fixed Period Product DM DL MOH Wood used in the table Wages of workers who assemble the tables Factory supervisor who oversees the assembly workers Electricity used in factory to run machines Depreciation on factory machines Company president's salary Advertising expense Sales commissions paid on each table sold Liability insurance for factory operations Depreciation on chairs and tables in factory lunchroom Toner and ink for photocopy machine used by Accounting Disposable gloves used by assembly workers Lubricant used for maintenance of machines Cost of shipping tables to customers Sandpaper used to prep wood for painting Rent on rooms at a Las Vegas hotel for annual sales conference Required: 1. Identify each cost as fixed or variable in relation to each table produced. 2. Identify each cost as a period or product (table) cost.

Explanation / Answer

(A) Wood used in table - Variable, Product, DM

(B) Wages of workers - Variable, Period, DL

(C) Factory Supervisor - Fixed, Product, MOH

(D) Electricity in Factory - Fixed, Product, MOH

(E) Depreciation on Factory machines - Fixed, Product, MOH

(F) Company President's salary - Fixed, Period, and neither DM/DL/MOH (Since it's not a manufacturing related expense)

(G) Advertising expense - Fixed, Period, and neither DM/DL/MOH (Since it's not a manufacturing related expense)

(H) Sales commission on each table - Variable, Period, and neither DM/DL/MOH (Since it's not a manufacturing related expense)

(I) Liability insurance -  Fixed, Period, and neither DM/DL/MOH (Since it's not a manufacturing related expense)

(J) Depreciation on chairs and tables in factory lunchroom - Fixed, Period, and neither DM/DL/MOH (Since it's not a manufacturing related expense)

(K) Toner & Ink used by Accounting - Fixed, Period, and neither DM/DL/MOH (Since it's not a manufacturing related expense)

(L) Disposable gloves used by assembly workers - Variable (higher production requires higher number of gloves), Product & MOH

(M) Lubricant used for maintenance of machines - Fixed, Product & MOH

(N) Cost of Shipping - Variable, Product, and neither DM/DL/MOH (Since it's not a manufacturing related expense)

(O) Sandpaper to prep wood - Variable, Product, DM

(P) Rent on Conference rooms - Fixed, Period, and neither DM/DL/MOH (Since it's not a manufacturing related expense)

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.