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A firm exists that makes only one product, using one kind of machine. Categorize each of the following costs as direct or indirect. Assume that
A firm exists that makes only one product, using one kind of machine. Categorize each of the following costs as direct or indirect. Assume that a traditional costing system is in effect. Justify your selection if the categorization would depend on the assumptions made. Cost of materials (inputs to production) Interest payments Machine depreciation Product handling and shipping costs Machine operator wages Utility costs Support (administrative) staff salaries Cost of marketing the product Cost of storing the product before sale Insurance costs Engineering drawings Machine operator overtime expenses Cost of tooling and fixtures
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