1. Direct materials, direct labor, and factory overhead

Identify the following costs as direct materials (DM), direct labor (DL), or factory overhead (FO):

• Wages of assembly line employees
• Maintenance for production machines
• Fabrics used to make product
• Factory rent

1. Prime and conversion cost

Identify the following costs as prime cost (P), conversion costs (C), or both (B) for a furniture manufacturer:

• Wages of the sanding process employees
• Wood
• Insurance cost
• Utilities cost

1. Product and period costs

Identify the following costs as product cost or period costs:

• Factory rent
• Plastic used to make a toy
• Office building rent
• Quality assurance workers