se the following data for answering questions 1 through 10. Harker Company manuf
ID: 2510835 • Letter: S
Question
se the following data for answering questions 1 through 10. Harker Company manufactures DVD players and other similar electronic products. Indicate whether the given cost is a product cost or period cost AND whether its cost behavior is fixed, variable, or mixed by selecting the appropriate options. A cost should be considered as variable if it changes in proportion to change in number of DVD players produced and sold. As an example, commissions paid to sales staff would be classified as a period cost and variable.
1. Salaries paid to sales staff
2. Insurance cost of factory building
3. Insurance cost of factory building
4. Wages paid to production workers in assembly
5.Depreciation on furniture and equipment in company headquarters.
6. Utilities cost for factory; amount includes electricity for running machines and costs for heating and lights
7. Rent on warehouse used to store finished goods ready for sale.
8. Salary paid to company CEO
9. Salaries paid to supervisors working in the factory
10. Depreciation on factory building and equipment
a. Product cost b. Period cost c. Fixed cost d. Variable cost e. Mixed cost
Explanation / Answer
Product/Period Variable/Fixed/Mixed 1. Salaries to sales staff Period Fixed 2. Insurance on factory building Product Fixed 3. Insurance on factory building Product Fixed 4. Wages paid to production workers Product Vvariable 5. Depreciaon on furnitute and equipment in headquarters Period Fixed 6. Utilities on factory product Mixed 7. Rent on warehouse Period Fixed 8. Salary paid to CEO Period Fixed 9. Salaries paid to suprvisors Product Fixed 10. Depreciation on factory building Product Fixed
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