Classifying costs: Product or SG&A cost; asset or expense Required Use the following format to classify each
Question:
Required
Use the following format to classify each cost as a product cost or a selling, general, and administrative (SG&A) cost. Also indicate whether the cost would be recorded as an asset or an expense. The first item is shown as anexample.
Cost Category Utilities used in manufacturing facility Cars for sales staff Real estate tax levied on a factory General office supplies Raw materials used in the manufacturing process Cost to rent office equipment Wages of production workers Advertising costs Promotion costs Production supplies Depreciation on administration building Depreciation on manufacturing equipment Research and development costs Cost to set up manufacturing equipment Product/SG&A Asset/Expense Product Asset
Step by Step Answer:
Cost Category Product SGA Asset Expense Utilities used in a manuf...View the full answer
Fundamental Managerial Accounting Concepts
ISBN: 978-0078025655
7th edition
Authors: Thomas Edmonds, Christopher Edmonds, Bor Yi Tsay, Philip Old
Related Video
Depreciation of non-current assets is the process of allocating the cost of the asset over its useful life. The cost of the asset includes the purchase price, any additional costs incurred to bring the asset to its current condition and location, and any other costs that are directly attributable to the asset. The useful life of the asset is the period over which the asset is expected to be used by the company. To calculate the depreciation, companies use different methods such as straight-line, declining-balance, sum-of-the-years\'-digits, units-of-production, and group depreciation. The chosen method will depend on the type of asset, the company\'s accounting policies, and the accounting standards that are applicable. The straight-line method allocates an equal amount of the asset\'s cost over its useful life, while the declining-balance method calculates depreciation at a fixed rate, typically double the straight-line rate, but the amount of depreciation decreases over time. The sum-of-the-years\'-digits method is similar to the declining-balance method, but the rate of depreciation is calculated using a fraction that is based on the useful life of the asset. It\'s important to note that the depreciation expense will be recorded on the company\'s income statement and the accumulated depreciation will be recorded on the company\'s balance sheet. This will decrease the value of the asset on the balance sheet over time.
Students also viewed these Managerial Accounting questions
-
Use the following format to classify each cost as a product cost or a selling, general, and administrative (SG&A) cost. Also indicate whether the cost would be recorded as an asset or an expense. The...
-
Indicate whether each item would be added ( + ) or subtracted ( ) in the computation of cash flow from operating activities using the indirect method. ______ 1. Accrued expenses (increase). ______...
-
Problem-4: An inverted hollow container with a uniform cross section area, A and height, H is slowly pushed into water as shown. The water rises into the container by a distance l (and compresses the...
-
4. What are the three categories of transactions in the balance of payments? Give an example of each. 5. Economists sometimes say that the current exchange rate system is a dirty float system. What...
-
An optically active compound D has the molecular formula C6H10 and shows a peak at about 3300 cm-1 in its IR spectrum. On catalytic hydrogenation D yields E (C6H14). Compound E is optically inactive...
-
You have been engaged for the audit of the Y Company for the year ended December 31, 2011. The Y Company is in the wholesale chemical business and makes all sales at 25% over cost. Following are...
-
The operating processes of a spark-ignition engine can be represented by the Otto cycle, which is internally reversible and gives a thermal efficiency of \[\eta_{\text {Otto...
-
Would it be worth it to incur a compensating balance of $10,000 in order to get a 1-percent-lower interest rate on a one-year, pure discount loan of $225,000?
-
What kind of measure is Statistics Canadas low-income measure (LIM-AT)?
-
Richard chooses technique 0 and 2 requiring 10+10-20 efforts and provising 10+11=21 benefits. Hence, 21 is returned as the output Example 2: input1: 3 input2: (10,10,10,10) input3: (10,11,12,15)...
-
Intel Corporation is mostly known for manufacturing silicon chips for computers. Answer the following questions using the companys Form 10-K for the period ended December 31, 2012. The Form 10-K can...
-
Jessica Hansen was talking to another accounting student, Adam Ruud. Upon discovering that the accounting department offered an upper-level course in cost measurement, Jessica remarked to Adam, How...
-
In Problem, find the second partials. (a) z xx (b) z yy (c) z xy (d) z yx z = x 2 y - 3xy
-
You MUST answer the entirety of this question a. The appeal of the "free market model" (perfect competition) is that it maximizes efficiency in production and maximizes consumer welfare if all of the...
-
Analysis of the production process of Subaway COMPANY?
-
4. The analysis (essay) must be based on official data and not on personal opinion. 5. The analysis must include: a. Determinants of price elasticity of demand. b. Detailed explanation of each one....
-
As settlor, Maria transfers her $500,000 mutual fund portfolio into a spousal trust that names her husband Elvis as the income beneficiary and her two children as the capital beneficiaries. Assume...
-
Imagine that a new, high-demand item has been simultaneously introduced into two countries: one with a command economy and one with a pure market economy. Describe how each country would approach...
-
Following are the measured densities at 20.0 C and 1 atm pressure of three gases: O 2 , 1.331 g/L; OF 2 , 2.26 g/L; NO, 1.249 g/L. Arrange them in the order of increasing adherence to the ideal gas...
-
SBS Company have received a contract to supply its product to a Health Care Service Hospital. The sales involve supplying 1,250 units every quarter, the sales price is RM 85 per unit. The Client...
-
What is impairment of assets? Is reversal of impairment loss feasible? Explain your answer based on the requirements of accounting standard.
-
Chad Bentley, president of Sabrin Corporation, evaluated the performance report of the company's production department. Mr. Bentley was confused by some arguments presented by Jeannette Dolan, the...
-
The mortgage division of Magee Financial Services, Inc. is managed by a vice president who supervises three regional operations. Each regional operation has a general manager and several branches...
-
Sheridan Industries, Inc. has five different divisions; each is responsible for producing and marketing a particular product line. The electronics division makes cellular telephones, pagers, and...
-
1. Analyze the code below and tell if a deadlock may occur or not. Justify your answer. semaphore a T1: wait (a); wait (b); signal (b); = 1, b = 1, c = 1; T2: wait (c); wait (b); signal (b); signal...
-
(75 points) Here is a distance matrix for 5 objects. 0 9 0 D = {dia) 3 3 7 0 4 6 590 5 11 10 2 8 0 (a) Perform the single linkage hierarchical clustering. Show your result by drawing a dendrogram....
-
Suppose we are given the following graph. We need the sampling to be done with the steady state probability distribution of a random walk to be (a) = (b) = (c) = (d) = (e) = () = What should the...
Study smarter with the SolutionInn App