EX $20-1$ Classify costs

Obj. $1$

Following is a list of various costs incurred in producing replacement automobile parts. With respect to the production and sale of these auto parts, classify each cost as either variable, fixed, or mixed.

Oil used in manufacturing equipment

Plastic

Property taxes, $$165,000$ per year on factory building and equipment

Salary of plant manager

Cost of labor for hourly workers

Packaging

Factory cleaning costs, $$6,000$ per month

Metal

Rent on warehouse, $$10,000$ per month plus $$25$ per square foot of storage used

Property insurance premiums, $$3,600$ per month plus $$0\mathrm{.}01$ for each dollar of property over $$1,200,000$

Straight$-$line depreciation on the production equipment

Hourly wages of machine operators

Electricity costs, $$0\mathrm{.}20$ per kilowatt$-$hour

Computer chip $($purchased from a vendor$)$

Pension cost, $$1\mathrm{.}00$ per employee hour on the job