S: Series A

Obj. $1$

PR $20-1$A Classify costs

Seymour Clothing Co$.$ manufactures a variety of clothing types for distribution to several major retail chains. The following costs are incurred in the production and sale of blue jeans:

a$.$ Shipping boxes used to ship orders

b$.$ Consulting fee of $$200,000$ paid to industry specialist for marketing advice

c$.$ Straight$-$line depreciation on sewing machines

d$.$ Salesperson's salary, $$10,000$ plus $2\%$ of the total sales

e$.$ Fabric

f$.$ Dye

g$.$ Thread

h$.$ Salary of designers

i$.$ Brass buttons

Legal fees paid to attorneys in defense of the company in a patent infringement suit, $$50,000$ plus $$87$ per hour

k$.$ Insurance premiums on property, plant, and equipment, $$70,000$ per year plus $$5$ per $$30,000$ of insured value over $$8,000,000$

Rental costs of warehouse, $$5,000$ per month plus $$4$ per square foot of storage used

m$.$ Supplies

n$.$ Leather for patches identifying the brand on individual pleces of apparel

a$.$ Rent on plant equipment, $$50,000$ per year

p$.$ Salary of production vice president

q$.$ Janitorial services, $$2,200$ per month

r$.$ Wages of machine operators

Electricity costs of $$0\mathrm{.}10$ per kilowatt$-$hour

t$.$ Property taxes on property, plant, and equipment

$($Continued$)$

Instructions

Classify the preceding costs as either fixed, variable, or mixed. Use the following tabular headings and place an $x$ in the appropriate column. Identify each cost by letter in the cost column.

Cost

Fixed Cost

Variable Cost

Mixed Cost