Question

The controller of Maxwell Department Store is preparing an income statement divided by sales departments and including subtotals for contribution margin, performance margin, and responsibility margin. Indicate the appropriate classification of the seven items (a through g) listed below. Select from the following cost classifications:
Variable costs
Traceable fixed costs—controllable
Traceable fixed costs—committed
Common fixed costs
None of the above
a. Cost of operating the store’s accounting department.
b. Cost of advertising specific product lines (classify as a fixed cost).
c. Sales taxes on merchandise sold.
d. Depreciation on the sewing machinery used in the Alterations Department.
e. Salaries of departmental sales personnel.
f. Salary of the store manager.
g. Cost of merchandise sold in the Sportswear Department.



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  • CreatedApril 17, 2014
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