Question $2$

$($a$)$ For Billy Manufacturers, the variable cost per unit is K$200.$

Required:

Calculate the total variable cost if Billy Manufacturers produces $100,200,$ or

$300$ units per month.

$($b$)$ Classify each of the following costs as fixed $($F$),$ variable $(V),$ or semi$-$variable

$($SV$),$ according to the number of units produced during the month:

$($i$)$ A factory supervisor's salary.

$(1$ mark$)$

$($ii$)$ The paper used in textbook production.

$(1$ mark$)$

$($iii$)$ Factory insurance

$(1$ mark$)$

$($iv$)$ The screws used in furniture production.

$(1$ mark$)$

$($v$)$ The rent on a factory building

$(1$ mark$)$

$($vi$)$ The piecemeal wages paid to workers assembling a product.

$(1$ mark$)$

$($vii$)$ The routine, monthly maintenance of machinery and three call$-$outs for

breakdowns.

$(1$ mark$)$

$($viii$)$ The wood used in furniture production.

$(1$ mark$)$

$($c$)$ Classify the following items as product costs or period costs:

$($i$)$ Material

$(1$ mark$)$

$($ii$)$ Marketing cost

$(1$ mark$)$

$($iii$)$ Salary of the secretary of the Human Resources Department.

$(1$ mark$)$

$($iv$)$ Salary of the machine operator.

$(1$ mark$)$