Exercise A: Classification of manufacturing costs (Value: 8 points)

Bike Inc. is a small company that builds custom bikes to customer specifications and operates out of a small facility that used to be a warehouse. The parts and parts of the bicycles are supplied by different manufacturers. Some of the costs incurred by the factory are presented below. It indicates the classification of costs in the following categories: direct materials (MD), direct labor (MOD), indirect costs (CI), administrative costs (CA) or sales costs (CV).

1. Salary of employees who manufacture bicycles

2. Rental of the premises

3. Cost of aluminum bicycle frames

4. Cost of ads in local magazines

5. Accountant's salary

6. Salary of the purchasing and manufacturing supervisor

7. Depreciation of tools

8. Commissions paid to sellers

Exercise B: Cost behavior (Value: 15 points)

Expreso Deli is a company that has several natural shake kiosks operating in various shopping centers. Each kiosk has a fixed cost of $ 1,000 and a variable cost of $ 0.60 for each beat.

1. Complete the following table of estimated costs at the different activity levels (shakes served per week) presented in each column. (Value: 12 points)

Total shakes served in a week

1,400 1,500 1,600

Fixed cost

Variable cost

Total cost

Average cost per shake served

2. Explain how the average cost per shake served varies as the level of activity increases and why. (3 points)