Problem 17-13

The following is a list of costs incurred by several business organizations. Classify each of the costs below as product costs or period costs. For those costs classified as product costs, indicate whether the product cost is a direct materials cost, direct labor cost, or factory overhead cost. For those costs classified as period costs, indicate whether the period cost is a selling expense or an administrative expense.

a. Telephone cable for a telephone company. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 1

b. Subscription to a health club for executives. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 2

c. Salary of the Director of Internal Auditing. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 3

d. Long-distance telephone bill for calls made by salespersons. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 4

e. Carrying cases for a manufacturer of video camcorders. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 5

f. Cotton for a textile manufacturer of blue jeans. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 6

g. Bandages for the emergency room of a hospital. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 7

h. Cost of company holiday party. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 8

i. Electricity used to operate factory machinery. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 9

j. State unemployment compensation taxes for factory workers. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 10

k. Gloves for factory machine operators. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 11

l. Fees paid lawn service for office grounds. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 12

m. Salary of secretary to vice-president of finance. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 13

n. Salary of secretary to vice-president of marketing. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 14

o. Production supervisor's salary. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 15

p. Engine oil for manufacturer and distributor of motorcycles. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 16

q. Oil lubricants for factory plant and equipment. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 17

r. Cost of a radio commercial. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 18

s. Depreciation on factory equipment. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 19

t. Wages of check-out clerk in company-owned retail outlet. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 20

u. Maintenance and repair costs for factory equipment. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 21

v. Depreciation on office equipment. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 22

w. Bonuses paid to salespersons. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 23

x. Insurance on factory building. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 24

y. Training for accounting personnel on use of microcomputer. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 25

z. Steel for a construction contractor. SelectPeriod Cost - Administrative ExpensePeriod Cost - Selling ExpenseProduct Cost - Direct Labor CostProduct Cost - Direct Materials CostProduct Cost - Factory Overhead CostItem 26