Bill Pope has developed a new device that is so exciting he is considering quitting his job in order to produce and market it on a large-scale basis. Bill will rent a garage for $300 per month for production purposes. Bill will rent production equipment at a monthly cost of $800. He estimates the material cost will be $5 per unit, and the labour cost will be $3 per unit. Advertising and promotion will cost $900 per month. To ensure Bill achieves his sales targets he will hire a commissioned salesman. Bill will have office equipment at which the depreciation expense will be $100.

Required:

Complete the chart below by placing an "X" under each heading that helps to identify the cost involved. You can place an "X" under more than one heading for a single cost: for example, a cost may be a variable cost and a MFG OH cost; you would place an "X" under each of these headings opposite the cost.

	Variable Cost	Fixed Cost	MFG OH	Non-Mfg OH
Factory rent
Direct labour
Factory equip rented
Material cost
Salesman commission
Office equipment depn
Advertising