Cost Classifications
Indicate whether each of the following costs for a bicycle manufacturer is a product or a period cost, a variable or a fixed cost, a value-adding or a non value adding cost, and, if it is a product cost, a direct or an indirect cost of the bicycle:
|
Cost Classification |
||||
|
Example |
Product or Period |
Variable or Fixed |
Value-Adding or Non value-Adding |
Direct or Indirect |
|
Bicycle tire |
Product |
Variable |
Value-adding |
Direct |
1. Depreciation on office computer
2. Labor to assemble bicycle
3. Labor to inspect bicycle
4. Internal auditor’s salary
5. Lubricant for wheels