Question
Putting an X in the appropriate spot, classify the costs as: Direct Material, Direct Labor, Overhead, or Period Costs.
The Fixed and Variable cost classifications have been provided for you.
Item/Cost "Direct
Material" "Direct
Labor" "
Overhead" Period Costs
Salary—Collar maker
Salary—Leash maker
Salary—Harness maker
Salary—Receptionist
High-tensile strength nylon webbing
Polyester and nylon ribbons
Buckles made of cast hardware
Depreciation on sewing machines
Rent
Utilities and insurance
Scissors, thread, and cording
Price tags
Office supplies
Other business equipment
Loan payment
Salary to self
The Fixed and Variable cost classifications have been provided for you.
Item/Cost "Direct
Material" "Direct
Labor" "
Overhead" Period Costs
Salary—Collar maker
Salary—Leash maker
Salary—Harness maker
Salary—Receptionist
High-tensile strength nylon webbing
Polyester and nylon ribbons
Buckles made of cast hardware
Depreciation on sewing machines
Rent
Utilities and insurance
Scissors, thread, and cording
Price tags
Office supplies
Other business equipment
Loan payment
Salary to self
Answers
GPT-4o mini
Here's the classification of the costs in the provided table. I'll place an "X" in the appropriate categories for each cost item:
| Item/Cost | Direct Material | Direct Labor | Overhead | Period Costs |
|------------------------------------------------|-----------------|--------------|----------|--------------|
| Salary—Collar maker | | X | | |
| Salary—Leash maker | | X | | |
| Salary—Harness maker | | X | | |
| Salary—Receptionist | | | | X |
| High-tensile strength nylon webbing | X | | | |
| Polyester and nylon ribbons | X | | | |
| Buckles made of cast hardware | X | | | |
| Depreciation on sewing machines | | | X | |
| Rent | | | X | |
| Utilities and insurance | | | X | |
| Scissors, thread, and cording | X | | | |
| Price tags | X | | | |
| Office supplies | | | | X |
| Other business equipment | | | | X |
| Loan payment | | | | X |
| Salary to self | | | | X |
### Notes:
- **Direct Material** costs include raw materials that become part of the finished product.
- **Direct Labor** costs encompass wages paid to workers who are directly involved in manufacturing.
- **Overhead** costs consist of indirect costs that are necessary for production but cannot be traced directly to specific products.
- **Period Costs** are the costs that are not tied to production and are typically expensed in the period they are incurred, often related to selling and administrative functions.
Make sure to review the classifications according to your understanding of the specific costs in your context!
| Item/Cost | Direct Material | Direct Labor | Overhead | Period Costs |
|------------------------------------------------|-----------------|--------------|----------|--------------|
| Salary—Collar maker | | X | | |
| Salary—Leash maker | | X | | |
| Salary—Harness maker | | X | | |
| Salary—Receptionist | | | | X |
| High-tensile strength nylon webbing | X | | | |
| Polyester and nylon ribbons | X | | | |
| Buckles made of cast hardware | X | | | |
| Depreciation on sewing machines | | | X | |
| Rent | | | X | |
| Utilities and insurance | | | X | |
| Scissors, thread, and cording | X | | | |
| Price tags | X | | | |
| Office supplies | | | | X |
| Other business equipment | | | | X |
| Loan payment | | | | X |
| Salary to self | | | | X |
### Notes:
- **Direct Material** costs include raw materials that become part of the finished product.
- **Direct Labor** costs encompass wages paid to workers who are directly involved in manufacturing.
- **Overhead** costs consist of indirect costs that are necessary for production but cannot be traced directly to specific products.
- **Period Costs** are the costs that are not tied to production and are typically expensed in the period they are incurred, often related to selling and administrative functions.
Make sure to review the classifications according to your understanding of the specific costs in your context!