Match the cost terms with the settings. More than one cost classification may be associated with each setting; however, select the setting that seems to fit the item best. When you are done, each cost term will be used just once. Clear All
Opportunity cost
Period cost
Product cost
Direct labor cost
Selling cost
The new product required machining, assembly, and painting. The design engineer asked the accounting department to estimate the labor cost of each of the three operations. The engineer supplied the estimated labor hours for each operation.
Linda was having a hard time deciding whether to return to school. She was concerned about the salary she would have to give up for the next 4 years.
Marcus Armstrong, manager of Timmins Optical, estimated that the cost of plastic, wages of the technician producing the lenses, and overhead totaled $30 per pair of single-vision lenses.
Randy Harris is the finished goods warehouse manager for a medium-sized manufacturing firm. He is paid a salary of $90,000 per year. As he studied the financial statements prepared by the local certified public accounting firm, he wondered how his salary was treated.
The auditor for a soft drink bottling plant pointed out that the depreciation on the delivery trucks had been incorrectly assigned to product cost (through overhead). Accordingly, the depreciation charge was reallocated on the income statement.