Sumitomo Cable manufactures various types of aluminum and copper cables which it sells directly to retail outlets through its distribution channels. The manufacturing process for producing cables includes a process called wire draw in which the aluminum and copper rods are pulled through a series of synthetic dies, which gradually decrease in size. The wires are then passed through an extruder, where either a single or a double coating of plastic is applied. These insulated wires are twisted into pairs by the Twisting and Stranding Department. The final shape is given to the wires by the Jacketing and Packaging department after carrying out the process of quality control.

1. Costs involved in the different processes are listed below. For each cost, indicate whether it is a direct variable, direct fixed, indirect variable, or indirect fixed cost, assuming that the “units of production of each kind of wire” is the cost object.

2. If the cost object were the “Jacketing and Packaging department” instead, which costs from requirement 1 would now be direct instead of indirect costs?

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Costs: Aluminum and copper rods Insulating materials Wages for wire draw Depreciation on machineries Depreciation on factory building Insurance on factory building Consumable stores and dies Wages for machine operators Power Quality control Repairs to machines Normal wastages and spoilages Store-keeper's salary Material testing Materials used by jacketing and packaging department Factory general utilities Fuel for factory generator Supervisors' salaries