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14 November, 03:45

PB4.

LO 2.2Pocket Umbrella, Inc, is considering producing a new type of umbrella. This new pocket-sized umbrella would fit into a coat pocket or purse. Classify the following costs of this new product as direct materials, direct labor, manufacturing overhead, or selling and administrative. 6

Cost of advertising the product

Fabric used to make the umbrellas

Maintenance of cutting machines used to cut the umbrella fabric so it will fit the umbrella frame

Wages of workers who assemble the product

President’s salary

The salary of the supervisor of the people who assemble the product

Wages of the product tester who stands in a shower to make sure the umbrellas do not leak

Cost of market research survey

Salary of the company’s sales managers

Depreciation of administrative office building

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Answers (1)
  1. 14 November, 07:36
    0
    Cost of advertising the product - Selling & Administrative Cost

    Fabric used to make the umbrellas - Direct Materials Cost

    Maintenance of cutting machines used to cut the umbrella fabric so it will fit the umbrella frame - Manufacturing overhead Cost

    Wages of workers who assemble the product - Direct labour Cost

    President's salary - Selling & Administrative Cost

    The salary of the supervisor of the people who assemble the product - Selling & Administrative Cost

    Wages of the product tester who stands in a shower to make sure the umbrellas do not leak - Direct labour Cost

    Cost of market research survey - Selling & Administrative Cost

    Salary of the company's sales managers - Selling & Administrative Cost

    Depreciation of administrative office building - Selling & Administrative Cost
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