Question
XYZ Corporation incurred the following costs in producing replacement auto parts. With respect to the production and sale of these auto parts, classify each cost
XYZ Corporation incurred the following costs in producing replacement auto parts. With respect to the production and sale of these auto parts, classify each cost as variable, fixed, or mixed.
Cost of labor for hourly workers
Factory cleaning costs
Hourly wages of machine operators
Computer chip purchased from a vendor
Electricity costs, $0.20 per kilowatt-hour
Metal
Salary of a plant manager
Property taxes of $165,000 per year on factory building and equipment
Plastic
Oil used in manufacturing equipment
Rent on warehouse, $10,000 per month plus $25 per square foot of storage used
Property insurance premiums, $3,600 per month plus $0.01 for each dollar of property over $1,200,000
Straight-line depreciation on the production equipment
Pension cost, $1.00 per employee hour on the job
Packaging
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