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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

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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. Utilities will cost $40 per month. Bill has already taken an industrial design course at the local community college to help prepare for this venture. The course cost $300. Bill will rent production equipment at a monthly cost of $800. He estimates the material cost per unit will be $5, and the labor cost will be $3. He will hire workers and spend his time promoting the product. To do this he will quit his job which pays $3,000 per month. Advertising and promotion will cost $900 per month. Required: Complete the chart below by placing an "X" under each heading that helps to identify the cost involved. There can be "Xs placed under more than one heading for a single cost, e.g., a cost might be a sunk cost, an overhead cost and a product cost; there would be an "X" placed under each of these headings opposite the cost. Opportunity Cost Sunk Cost Variable Cost Fixed Cost Manufacturing Overhead Cost Productos Selling Cost Differential Cost Garage rent Utilities Cost of the industrial design course Equipment rented Material cost Labor cost Present salary Advertising Part b) A partial listing of costs incurred at Starr Corporation during June appears below: $107.000 S11,000 S115.000 Direct materials Utilities, factory Sales commiss Administrative salaries Indirect labor Advertising Depreciation of producten Det ser Depreciation of administrative equipment Required: $14.000 $109,000 a. What is the total amount of product cost listed above? Show your work. b. What is the total amount of period cost listed above? Show your work

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