PART I

Match the definition to the letter A) Indirect Cost B) Period Cost C) Product Cost D) Direct Cost E) Conversion Costs F) Prime Costs

Defintions:

Cost cannot be traced to a specific product, process, or department.

Cost incurred not related to creating the product itself.

Direct costs incurred in making a product.

Cost can be directly traced to a specific product, department or process.

Costs incurred to turn a raw material into a finished good.

Cost is related to created a product either directly or indirectly.

PART II

Summer Springs Inc. had the following account balances:

Direct Labor	$ 12,500
Raw Materials Purchased	8,500
Factory Utilities	900
Factory Supervisor Salary	1,000
Factory Rent	2,000
Administrative Expense	3,000
Marketing Expense	500
Raw Materials Inventory, September 1	$ 5,000
Raw Materials Inventory, September 30	10,000
Work in Process Inventory, September 1	$ 30,000
Work in Process Inventory, September 30	35,000
Finished Goods Inventory, September 1	$ 20,000
Finished Goods Inventory, September 30	28,000

Calculate the following amounts:

Direct materials used

Direct labor

Factory overhead

Cost of goods manufactured

Cost of goods sold