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Cotton White, Inc., makes specialty clothing for chefs. The company reported the following costs for 2010.
1: Compute the cost of direct labor for Cotton White. (Omit the "$" sign in your response.) Direct labor cost:$___________ 2. Compute the cost of manufacturing overhead for Cotton White. (Omit the "$" sign in your response.) Manufacturing overhead:$___________ 3. Compute the total manufacturing cost for Cotton White. (Omit the "$" sign in your response.) Total manufacturing cost:$___________ 4. Compute the prime cost for Cotton White. (Omit the "$" sign in your response.) Prime cost:$___________ 5. Compute the conversion cost for Cotton White. (Omit the "$" sign in your response.) Conversion cost:$___________ 6. Compute the total period cost for Cotton White. (Omit the "$" sign in your response.) Total period cost:$___________
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Explain the rationale for recognizing costs as expenses at the time of product sale.
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