Table 1 classifies various items from the data given; the first column (A) gives
ID: 399148 • Letter: T
Question
Table 1 classifies various items from the data given; the first column (A) gives item number; the last column (G) on right gives the total costs for 10,000 units. The 2nd column (B) shows if the item is direct or indirect; 3rd column shows variable or fixed; 4th (D) says whether it is product (pr) or (pe)or period cost. It then adds the numerical values of those items.
the 2nd table breaks cost behavior further to show which are fixed, variable and mixed.
Please answer the following Questions ----the answers refer to the table 1 from above.
Write down which of the items are PRODUCT COSTS? [they are indicated by the letter “pr” in the table]:
Write down the items considered PERIOD COSTS? [ they are indicated by the letter “pe” in the table]
Write down the items are indirect? [ Indicated by “id” ]
Which of the items are direct or indirect? [ indicated by “d” ]
B C D total for 0 9 per10,000 units Item # tem unit V pr direct material direct labor 3.5 35000 id pr var. mfg OH id f pr fix. mfg OH f pe f pe v pe sales commissions total product fix. Selling fix. Adm id id 30,000 20000 10000 id var. adm.OH total period pe 0.5 10 65,000 215,000Explanation / Answer
1. Items 1,2,3,4 are Product Costs
2. Items 6,7,8,9 are Period Costs
3. Items 3,4,6,7,9 are indirect
4. Items 1,2,8 are direct.
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