6. Tommy’s Custom Furniture is a manufacturer of sofas. Listed below are selecte
ID: 2544730 • Letter: 6
Question
6.
Tommy’s Custom Furniture is a manufacturer of sofas. Listed below are selected cost items for the entire company. Classify each cost item as either a fixed or variable cost, and either a product or a period cost by placing an X in the appropriate boxes.
I completed the first item for you. (4 points)
Cost by behavior
Cost by function
Variable
Fixed
Product
Period
Fabric used for sofas
X
X
Sales commissions
Supplies used in the factory
Accounting staff salaries
Sales office rent
Direct labor for factory workers
Depreciation on factory equipment
Office supplies
Sales commissions
6.
Tommy’s Custom Furniture is a manufacturer of sofas. Listed below are selected cost items for the entire company. Classify each cost item as either a fixed or variable cost, and either a product or a period cost by placing an X in the appropriate boxes.
I completed the first item for you. (4 points)
Cost by behavior
Cost by function
Variable
Fixed
Product
Period
Fabric used for sofas
X
X
Sales commissions
Supplies used in the factory
Accounting staff salaries
Sales office rent
Direct labor for factory workers
Depreciation on factory equipment
Office supplies
Sales commissions
Explanation / Answer
COST BY BEVAVIOUR COST BY FUNCTION VARIABLE FIXED PRODUCT PERIOD Fabric used in production X X sales commission X X Supplies used in factory X X Accounting staff salaries X X Sales offce rent X X Direct labour of factory workers X X Depreciation on Factory equipment X X Office supplies X X sales commission X X
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