Georgia Pacific, a manufacturer, incurs the following costs. (1) Classify each cost as either a product or a period cost. If a product cost, identify it as a prime and/or conversion cost. (2) Classify each product cost as either a direct cost or an indirect cost using the product as the cost object.
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Product Cost |
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Cost |
Prime |
Conversion |
Period Cost |
Direct Cost |
Indirect Cost |
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1. Office supplies used |
____ |
____ |
____ |
____ |
____ |
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2. Bad debts expense |
____ |
____ |
____ |
____ |
____ |
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3. Small tools used |
____ |
____ |
____ |
____ |
____ |
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4. Factory utilities |
____ |
____ |
____ |
____ |
____ |
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5. Advertising |
____ |
____ |
____ |
____ |
____ |
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6. Amortization of patents on factory machine |
____ |
____ |
____ |
____ |
____ |
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7. Payroll taxes for production supervisor |
____ |
____ |
____ |
____ |
____ |
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8. Accident insurance on factory workers |
____ |
____ |
____ |
____ |
____ |
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9. Depreciation — Factory building |
____ |
____ |
____ |
____ |
____ |
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10. State and federal income taxes |
____ |
____ |
____ |
____ |
____ |
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11. Wages to assembly workers |
____ |
____ |
____ |
____ |
____ |
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12. Direct materials used |
____ |
____ |
____ |
____ |
____ |