Required 1. McPhairs owner is interested in a strategic analysis of the business. The owner wants to understand why overall profitability has declined slightly in the most recent year while other studios in the area seem to be doing well. What is the proper cost object to begin this analysis? Explain your choice. 2. For each of the cost elements determine the cost classification from the following list for the cost object you chose in requirement 1. (In some cases, two or more classifications may apply.) Cost Elements 1. Each dancing instructors salary. 2. Managers salary. 3. Music tapes used in instruction. 4. Utilities for the studio. 5. Part-time studio receptionist. 6. Planning and development materials sent from the home office. 7. Free lessons given by each studio as a promotion. 8. Regional TV and radio advertisements placed several times a year. Cost Classifications a. Direct b. Indirect c. Variable d. Fixed e. Controllable by studio manager f. Uncontrollable by studio manager