The costs below all relate to Sounds Good, a company based in Alberta that manufactures high-end audio equipment such as speakers, receivers, CD players, turntables, and home theatre systems. The company owns all of the manufacturing facilities (building and equipment) but rents the space used by the non-manufacturing employees (accounting, marketing, sales, human resources).
Required: For each cost, indicate whether it would most likely be classified as a direct labour, direct material, manufacturing overhead, marketing and selling, or administrative cost.(Select all that apply.)
1. Depreciation, taxes, and insurance on the manufacturing facilities.
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| | | Direct labour cost | | Direct material cost | | Manufacturing overhead cost | | Marketing and selling cost | | Administrative cost | |
2. Rent on the office space used by the non-manufacturing staff.
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| | | Direct labour cost | | Direct material cost | | Manufacturing overhead cost | | Marketing and selling cost | | Administrative cost | |
3. Salaries paid to the employees who produce the audio equipment.
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| | | Direct labour cost | | Direct material cost | | Manufacturing overhead cost | | Marketing and selling cost | | Administrative cost | |
4. Cost of the glue used to fasten the companys logo to the grill used on all of its speakers.
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| | | Direct labour cost | | Direct material cost | | Manufacturing overhead cost | | Marketing and selling cost | | Administrative cost | |
5. The cost of online advertising.
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| | | Direct labour cost | | Direct material cost | | Manufacturing overhead cost | | Marketing and selling cost | | Administrative cost | |
6. Salaries paid to the accounting employees.
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| | | Direct labour cost | | Direct material cost | | Manufacturing overhead cost | | Marketing and selling cost | | Administrative cost | |
7. Salary paid to the production manager who supervises the manufacturing activities for all products.
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| | | Direct labour cost | | Direct material cost | | Manufacturing overhead cost | | Marketing and selling cost | | Administrative cost | |
8. Cost of the plastic used for turntable dust covers.
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| | | Direct labour cost | | Direct material cost | | Manufacturing overhead cost | | Marketing and selling cost | | Administrative cost | |
9. Bonuses paid to sales staff for meeting their monthly sales goals.
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| | | Direct labour cost | | Direct material cost | | Manufacturing overhead cost | | Marketing and selling cost | | Administrative cost | |
10. Salary paid to the manager of the human resources department.
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| | | Direct labour cost | | Direct material cost | | Manufacturing overhead cost | | Marketing and selling cost | | Administrative cost | |
