Topic 1: Cost Classification Direction: Read and answer what is required. 1-Suppose that you have been given a summer job as an intern at ABC Aircams, a company that manufactures sophisticated spy cameras for remote-controlled military reconnaissance aircraft. The company, which is privately owned, has approached a bank for a loan to help it finance its growth. The bank requires financial statements before approving such a lean. You have been asked to help prepare the financial statements and were given the following list of costs: 1. Rent on equipment used in the factory. 2. Lubricants used for machine maintenance. 3. Soap and paper towels used by factory workers at the end of a shift. 4. Factory supervison'salaries. 5. Heat, water, and power consumed in the factory. 6. Advertising costs. 7. Workers' compensation insurance for factory employees. 8. The wages of the receptionist in the administrative offices Required: Classify the above costs for the purpose of preparing the financial statements for the bank. Chen Dot Material Diet Labor Machined Mango Selling Ad Co 2-The PC Works assembles custom computers from components supplied by various manufacturers. The company is very small and its assembly shop and retail sales store are housed in a single facility in a Redmond, Washington, industrial park. Listed below are some of the costs that are incurred at the company. Required: For each cost, indicate whether it would most likely be classified as direct labor, direct materials, manufacturing overhead, selling, or an administrative cost. 1. The cost of a hard drive installed in a computer. 2. The cost of advertising in the Puget Sound Computer User newspaper. 3. The wages of employees who assemble computers from components. 4. Sales commissions paid to the company's salespeople. 5. The wages of the assembly shop's supervisor. The wages of the company's accountant Required: Classify these costs according to the various cost terms used in the chapter Carefully study the classification of each cost. CD Maria Di Labor Mating read Making Selling Advent