Obj. 2 EX 16-2 Classifying costs as materials, labor, or factory overhead Indicate whether the following costs of Procter & Gamble (PG), a maker of consumer prod- ucts, would be classified as direct materials cost, direct labor cost, or factory overhead cost: a. Depreciation on assembly line equipment in the Mehoopany, Pennsylvania, paper products plant b. Packaging materials C. Maintenance supplies d. Licensing payments for use of Disney characters on children's products e. Paper used in bath tissue f. Salary for process engineers g. Chemicals for body wash products h. Plant manager salary for the lowa City, lowa, plant i. Scents and fragrances used in making soaps and detergents j. Wages of production line employees at the Pineville, Louisiana, soap and detergent plant

Obj. 2 EX 16-2 Classifying costs as materials, labor, or factory overhead Indicate whether the following costs of Procter & Gamble (PG), a maker of consumer prod- ucts, would be classified as direct materials cost, direct labor cost, or factory overhead cost: a. Depreciation on assembly line equipment in the Mehoopany, Pennsylvania, paper products plant b. Packaging materials C. Maintenance supplies d. Licensing payments for use of Disney characters on children's products e. Paper used in bath tissue f. Salary for process engineers g. Chemicals for body wash products h. Plant manager salary for the lowa City, lowa, plant i. Scents and fragrances used in making soaps and detergents j. Wages of production line employees at the Pineville, Louisiana, soap and detergent plant

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Select and “X” in the column that corresponds to the cost classification for each of the following scenarios. Some items may fit in more than one column.
(b) Classify whether the items below refer to direct material cost (DM), direct labour cost (DL), or production overhead cost (POH). (i) (ii) (iii) (iv) Wages of production line workers. Maintenance of machineries. Purchase of direct materials. Purchase of loose tools. (v) (vi) (vii) Wages of factory supervisor. (viii) Depreciation on plant. (ix) Lubricating oil for machine. Hire of special machine. (x) Freight charges on direct materials. Factory light and power.
Required: Classify the following costs as period or traceable costs. Depreciation on office building Insurance expense for factory building Product liability insurance premium Transportation charges for raw materials Factory repairs and maintenance Rent for inventory warehouse Cost of raw materials Factory wages Salary to chief executive officer Depreciation on factory Bonus to factory workers Salary to marketing staff Administrative expenses Bad debt expense Advertising expense Research and development Warranty expense Electricity for plant
Marsden Company has three departments occupying the following amount of floor space: 20,000 square feet 10,500 square feet 30,000 square feet Department 1 Department 2 Department 3 How much store rent should be allocated to Department 3 if total rent is equal to $94,000? Note: Do not round Intermediate calculations. Multiple Choice $30,000 $46.612 $16,314 None of the answers are correct.
9:01 5:34 Manufacturing Overhead consists of which of the following costs: (check all that apply) HUUM ◄ Previous Utilities in the factory Utilities in the corporate office Property taxes on the factory Salary of factory supervisor Materials that are incorporated into a product Prime costs SUBMIT K + CC
23. Which of the following costs is relevant to a make-or-buy decision of a particular part of a product? a.The direct labor costs used to manufacture the part b.The depreciation on the plant used to manufacture the part c.The fixed annual rent paid for the office building d.The salary of the sales manager who sells the product
Indicate whether each cost is: A. Fixed or Variable b. Selling, General/Administrative, or Manufacturing
Which of the following costs is best classified as a fixed cost with respect to volume of activity? (See your Chapter 20 notes, page 5) Direct labor Electricity used to heat, light, and cool a factory Cleaning supplies used in an automobile assembly plant Straight-line depreciation expense of a machine used in a factory Total cost of salaries paid to quality inspectors in a manufacturing plant Tires used in an automobile manufacturing plant
:14 es Howell Corporation's activity-based costing system has three activity cost pools-Machining, Setting Up, and Other. The company's overhead costs, which consist of equipment depreciation and indirect labor, are allocated to the cost pools in proportion to the activity cost pools' consumption of resources. Equipment depreciation (total) Indirect labor (total) Distribution of Resource Consumption Across Activity Cost Pools Setting Up 0.30 0.10 Equipment depreciation Indirect labor Product S4 Product CO Total Costs in the Machining cost pool are assigned to products based on machine-hours (MHS) and costs in the Setting Up cost pool are assigned to products based on the number of batches. Costs in the Other cost pool are not assigned to products. Sales (total) Direct materials (total) Direct labor (total) $ 33,800 $ 7,950 MHS 8,900 6,300 15,200 Required A Machining 0.30 0.30 Additional data concerning the company's products appears below: Product S4 Product Co $ 88,100 $ 75,500 $…
Required: 1. What was the cost of raw materials put into production during the year? 2. How much of the materials in requirement 1 consisted of indirect materials? 3. How much of the factory labour cost for the year consisted of indirect labour? 4. What was the cost of goods manufactured for the year? 5. What was the cost of goods sold for the year (before considering underapplied or overapplied overhead)? 6. If overhead is applied to production on the basis of direct materials cost, what rate was in effect during the year? 7. Was manufacturing overhead underapplied or overapplied? By how much? 8. Compute the ending balance in the Work in Process inventory account. Assume that this balance consists entirely of goods started during the year. If $33,200 of this balance is direct materials cost, how much of it is direct labour cost? Manufacturing overhead cost?
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