Exercise 14-6 Cost classification 03 Georgia Pacific, a manufacturer, incurs the following costs. (1) Classify each cost as either a product (PROD) or period (PER) cost. If a product cost, identify it as direct materials (DM), direct labor (DL), or factory overhead (FO), and then as a prime (PR) or conversion (CONV) cost. (2) Classify each product cost as either a direct cost (DIR) or an indirect cost (IND) using the product as the cost object. Chapter 14 Managerial Accounting Concepts M Product Cost. Then If Product Cost, Then: Prime or Conversion Direct Materials, Direct Labor, or Factory Overhead Product or Period Cost Direct or indirect 1. Factory Utilities 2. Advertising 3. Amortization of patents on factory machine.... 4. State and federal income taxes 5. Office Supplies used 6. Insurance on factory building 7. Wages to assembly workers