The following costs items relate to the operations of Canoe Company. Classify ea

Question

The following costs items relate to the operations of Canoe Company. Classify each as a produce cost or a period cost by placing and “X” in the appropriate column. Also, for those costs that are classified as product costs, indicate whether they should be classified as direct or indirect costs.

Product Period

Costs Costs Direct Indirect

Sales Commissions _____ _____ _____ _____

Expired insurance-factory _____ _____ _____ _____

Sales salaries _____ _____ _____ _____

Office supplies _____ _____ _____ _____

Supervisory salaries-factory _____ _____ _____ _____

Factory utilities _____ _____ _____ _____

Shipping to customers _____ _____ _____ _____

Office Salaries _____ _____ _____ _____

Small tools- written off _____ _____ _____ _____

Explanation / Answer

Sales Commission Product Indirect Cost Expired Insurance Policy Period Sales Salaries Product Indirect Office Supplies Product Direct Supervisory Salary Product Indirect Factory Utilities Product Direct Shipping to customers Product Indirect office salaries Product Indirect Small tools written off Period

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