Cost Classifications The following are costs associated with manufacturing firms, merchandising firms, or service firms:

a. Legal services for an accounting firm

b. Car leases for company management

c. Oil used to service manufacturing equipment

d. Office supplies for a grocery store

e. Entertainment expense for clients

f. Travel expenses for doctors in a medical firm g. Plastic used in making computers h. Collection costs of accounts receivable i. Electricity to run saws at a lumber yard j. Food for a company banquet k. Advertising expense l. Continuing education for a doctor m. Commissions paid to salespersons n. Depreciation on sports equipment by a professional football team o. Calculators used by office employees p. Fuel used in baggage transporters at an airport q. Toll charges incurred because of business travel r. Fuel used in manufacturing equipment Classify the costs as (1) product or period; (2) variable or fixed; and (3) for those that are product costs, as direct materials, direct labor, or manufacturing overhead. Write “not applicable

(N/A)” if a category doesn’t apply.