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Can someone assist me with this? I am not understanding how to go about completing this isses that for to sam snowand Monday, Februa 2585-256

Can someone assist me with this? I am not understanding how to go about completing this

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isses that for to sam snowand Monday, Februa 2585-256 DISCUSSION BOARD PROBLEM - CHAPTER 16 Classifying Costs 1. Salary of fact The following is a list of costs that were incurred in the production and sale of lawn mowers ary of factory supervisor. 2. Steel used in producing the lawn mowers. 4. Tires in 3. Commissions paid to lawn mower sales representatives. S. Property gas on the lawn mowers during production during production 5. Property taxes on the factory building and equipment. 7. Salary of vice-president of mar Hourly wages of operators of machinery used in producing the lawn mowers. 8. Gasoline engines installan marketing. stalled in the lawn mo 9. Telephone charges for the company's answers during production 11. Electricity used in the prod s accounting department. 10. Plastic for outside housing on the lawn mowers during production. A ed to com the production of the lawn mowers. 12. Paint used to coat the lawn movers 13. Wages of janitorial staff in the factory. 14. Cost of advertisin movers during production of advertising in a national magazine Filter for spray gun used to paint the lawn mowers during production. REQUIRED: 1. Classify each cost as either a product cost or a period cost. If you classify the cost as a product cost, then identify whether it is a direct materials cost, direct labor cost, or a manufacturing overhead cost. If you classify the cost as a period cost, then identify whether it is a selling expense or administrative expense. E THE FORMAT BELOW 7 141 3495 1. Salary of factory supervisor. 2. Steel used in producing the lawn mowers. PRODUCT Direct Direct COST Materials Labor 3. Commissions paid to lawn mower sales representatives. 4. Tires installed on the lawn mowers during production. 5. Property taxes on the factory building and equipment. 6. Hourly wages of operators of machinery used in producing the lawn mowers. 7. Salary of vice-president of marketing. To aid you in the completion of this assignment, I am using Assignment #3 listed in the "Assignments-Problems and Solutions" on the Course's Hon explanation for Course's Home Page. I will give ch expenditure listed. Is it a Product Cost {Direct Materials, Direc Labor, or Factory (Manufacturing) Overhead} or a Period Cost (Selling Expense or Administrative Expense). A Selling Expense is an ex ense is an expenditure related to selling, promoting, or distributing the product of a company. An Administrative Expense is an expenditure related to managing or operating the company. The answers are in bold letters. a. Property taxes on factory building. Answer: any expenditure that relates to the factory, plant, product, production, or manufacturing, is a product cost. The key word here is factory. Property taxes on the factory building is a product cost, but because of Overhead. its indirect nature (it can't be traced into each unit of product) it is classified as Factory b. Salaries of office workers in the credit department. Answer: this does not relate to the production of the product, it is a period cost. The key word is here is office where the accountants and administration work. Therefore, it is a classified as an Administrative Expense. c. Depreciation on raw materials warehouse. Answer: Raw materials are used in the production of the product and therefore the depreciation on the raw materials warehouse is a product cost. Since depreciation is indirect in nature, and not traceable to each unit of product, it is classified as Factory Overhead. d. Income taxes on a profitable manufacturing company. Answer: Income tax expense statement, and although it is a period cost, it is a separate line item on the income statement, and a is neither a Selling Expense or Administrative Expense. e. Cost of disposal of hazardous waste materials to a chemical plant. Answer: Since the hazardous waste materials are coming from the ning from the production process in the chemical plant, it is a product cost. It is indirect in nature, and not tre e, and not traceable to each unit of product, therefore it is classified as Factory Overhead. f. Amounts paid by a mobile home manufacturer to a subcontractor who installs plumbing in each mobile home. Answer: The cost of the plumbing in each mobile home is a material cost that is traceable to each mobile home and, therefore, it is a product cost classified as Direct Materials. g. Depreciation on sales showroom fixtures. Answer: The key word is here is sales. The depreciation on the sales showroom is a period cost a period cost classified as a Selling Expense. h. Salaries of security guards in administrative office build s administrative. The salaries of the security guards is related to the administration prefore is a period cost classified as or operation of the company, and is therefore is a perio Administrative Expense. i. Salaries of factory security guards. Answer: The key word here is factory. The security guards are working in the factory and therefore the c therefore the cost of their salary is a product cost. Because of the indire urity guards' salaries (the salaries cannot be raced into each unit of product), the security therefore classified as Factory Overhead. salaries are indirect labor and 12:16:53 pm 02-22-2020

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