Creative Crates Co. produces wooden crates used for shipping products by ocean liner. In 2014, Creative incurred the following costs.

Wood used in crate production $56,080

Nails (considered insignificant and a variable expense) $480

Direct labor $41,070

Utilities for the plant: $2,600 each month, plus $0.54 for each kilowatt-hour used each month

Rent expense for the plant for the year $21,900

Assume Creative used an average 500 kilowatt-hours each month over the past year.

(a) What is Creative