Reference no: EM132684423

Problem - Classifying costs - The following is a list of costs that were incurred in the production and sale of boats:

a. Annual bonus paid to top executives of the company.

b. Cost of paving the headquarters employee parking lot.

c. Steering wheels.

d. Salary of shop supervisor.

e. Power used by sanding equipment.

f. Cost of electrical wiring for boats.

g. Commissions to sales representatives, based upon the number of boats sold.

h. Legal department costs for the year.

i. Memberships for key executives in the Bass World Association.

j. Yearly cost maintenance contract for robotic equipment.

k. Cost of normal scrap from defective hulls.

l. Masks for use by sanders in smoothing boat hulls.

m. Decals for boat hull.

n. Salary of president of company.

o. Cost of boat for "grand prize" promotion in local bass tournament.

p. Special advertising campaign in Bass World.

q. Wood paneling for use in interior boat trim.

r. Cost of metal hardware for boats, such as ornaments and tie-down grasps.

s. Annual fee to pro-fisherman Bill Tennessee to promote the boats.

t. Canvas top for boats.

u. Straight-line depreciation on factory equipment.

v. Oil to lubricate factory equipment.

w. Fiberglass for producing the boat hull.

x. Salary of chief financial officer.

y. Hourly wages of assembly line workers.

z. Boat chairs.

Instructions - Classify each cost as either a product cost or a period cost. Indicate whether each product cost is a direct materials cost, a direct labor cost, or a factory overhead cost. Indicate whether each period cost is a selling expense or an administrative expense. Use the tabular headings for your answer, placing an "X" in the appropriate column.