Water Technology, Inc. incurred the following costs during 20x1. The company sold all of its products manufactured during the year.

Direct material ................................................................$3,000,000

Direct labor .......................................................................2,200,000

Manufacturing overhead:

Utilities (primarily electricity) ...............................................140,000

Depreciation on plant and equipment ...............................230,000

Insurance ...............................................................................160,000

Supervisory salaries .............................................................300,000

Property taxes ......................................................................210,000

Selling costs:

Advertising ...........................................................................195,000

Sales commissions ................................................................90,000

Administrative costs:

Salaries of top management and staff .............................372,000

Office supplies .......................................................................40,000

Depreciation on building and equipment ..........................80,000

During 20x I, the company operated at about half of its capacity, due to a slowdown in the economy. Prospects for 20x2 are slightly better. Jared Lowes, the marketing manager, forecasts a 20 percent growth in sales over the 20x1 level,

Required:

Categorize each of the costs listed above as to whether it is most likely variable or fixed. Forecast the 20x2 cost amount for each of the cost items listed above.