or a manufacturing company, both direct labor costs and indirect labor costs are 1) F classified as product costs. 2) A compan would classify the sandpaper as direct material because it is physically consumed in the production process. y uses sandpaper to prepare its product for finishing. Most manufacturers 3) Costs that are not classified as product costs are normally expensed in the period incurred 4) A cost that is considered variable for one activity base may be considered fixed for a different activity base. tribution margin format income statement classifies costs according to their 5) The con behavior patterns. TRUE/FALSE. Write "T' if the statement is true and 'F' if the statement is false. 1) For a manufacturing company, both direct labor costs and indirect labor costs are classified as product costs. 1) 2) A company uses sandpaper to prepare its product for finishing, Most manufacturers 2) would classify the sandpaper as direct material because it is physically consumed in the production process 3) Costs that are not classified as product costs are normally expensed in the period incurred 3) 4) A cost that is considered variable for one activity base may be considered fixed for a 4) different activity base. 5) The contribution margin format income statement classifies costs according to their 5) behavior patterns