Crescendo Srl operates a large store in Milan. The store has both a film (video/ DVDs) section and a musical (compact discs and tapes) section. Crescendo reports revenues for the film section separately from the musical section.
Required
Classify each of the following cost items as:
a. Direct or indirect (D or I) costs with respect to the film section.
b. Variable or fixed (V or F) costs with respect to how the total costs of the film section change as the number of films sold changes. (If in doubt, select the cost type on the basis of whether the total costs will change substantially if a large number of films are sold.) You will have two answers (D or I; V or F) for each of the following items:

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Cost item D or I V or F A Annual retainer paid to a film distributor B Electricity costs of Crescendo store (single bill covers entire store) C Costs of films purchased for sale to customers D Subscription to Video-Novo magazine E Leasing of computer software used for financial budgeting at Crescendo store F Cost of popcorn provided free to all customers of Crescendo G Earthquake insurance policy for Crescendo store H Freight-in costs of films purchased by Crescendo