CHAPTER 18 Classifying Costs The following is a list of costs that were incurred
ID: 2572375 • Letter: C
Question
CHAPTER 18
Classifying Costs The following is a list of costs that were incurred in the production and sale of large commercial airplanes: e whether each product expense or an administrative expense. Costs Classification a. Salary of chief compliance officer of company b. Power used by painting equipment c. Instrument panel installed in the airplane cockpit d. Annual bonus paid to the chief operating officer of the company e. Turbo-charged airplane engine f. Interior trim material used throughout the airplane cabin 9.Cost of normal scrap from production of airplane body h. Hourly wages of employees that assemble the airplane i. Salary of the marketing department personnel . Cost of paving the headquarters employee parking lot k. Cost of electrical wiring throughout the airplane I. Cost of electronic guidance system installed in the airplane cockpit m. Salary of plant managerExplanation / Answer
Classification of cost
a. Salary of chief compliance officer of company Period Cost b. Power used by Painting Equipment Product Cost, Factory Expenses c. Instrument Panel installed in the airplane cockpit Product Cost, Direct Material Cost d. Annual Bonus paid to the Chief Operating Officer of the Company Period Cost e. Turbo Charged Airplane engine Product Cost, Direct Material Cost f. Interior Trim material used throughout the Airplane Cabin Product Cost, Direct Material Cost g. Cost of normal scrap from production of airplane body Product Cost, Direct Material Cost h. Hourly wages of employees that assemble the airplane Product Cost, Direct Labour Cost i. Salary of the Marketing Department Personnel Period Costs j. Cost of paving the headquarters employee parking lot Product Costs, Direct Labour Costs k. Cost of Electrical wiring throughout the airplane Product Cost, Direct Material Cost l. Cost of Electronic guidance system installed in the airplane cockpit Product Cost, Direct Material Cost m. Salary of Plant manager Product costs, Factory Expenses n. Cost of miniature replicas of airplane used to promote and market the airplane Period costs, Advertising expenses o. Human Resources departments costs for the year Period Costs p. Metal used for producing the airplane body Product Cost, Direct material Cost q. Annual Fee to a celebrity to promote the aircraft Period Cost, Advertising Expenses r. Hydraulic pumps used in the airplane's flight control system Product Cost, Direct Material Cost s. Yearly cost of the maintenance contract for robotic equipment Period Cost t. Prebuilt Leather seats installed in the first class cabin Product Cost, Direct Material Cost u. Depreciation on Factory Equipment Period Cost v. Special Advertising compaign in Aviation World magazine Period Cost, Advertising Expenses w. Oil to lubricate factory equipment Product Cost, Factory expenses x. Masks for use by painters in painting of airplane body Product Cost, Direct Labour Expenses y. Decals for cockpit door, the cost of which is immaterial to the cost of the final product Product cost, Direct material cost z. Salary of Chief Financial Officer Period Cost