Instructions:

• Classify the following items as either product cost or period cost
• If it is product cost, identify whether it is direct materials, direct labor, or manufacturing overhead.
• If it is period cost, identify if it is selling expense or administrative expense.

Example answer: "Product cost - Direct Materials"

1. Sales salaries
2. Wages of assembly line workers
3. Office salaries
4. Lumber used in the manufacture of tables and chairs.
5. Sand paper used by a furniture manufacturer
6. Leather used in shoe manufacturer
7. Glue used in show manufacturing
8. Fabric used by a garment company
9. Hard drive used in assebly of computers
10. Advertising cost
11. Office rent
12. Factory utilities
13. Sales commissions
14. Wages of sewers in a garment manufacturing company
15. Depreciation of a high-speed sewing machine