The following is a list of costs that were incurred in the production and sale of boats:
a. Cost of electrical wiring for boats.
b. Commissions to sales representatives, based upon the number of boats sold.
c. Salary of shop supervisor.
d. Salary of president of company.
e. Cost of boat for “grand prize” promotion in local bass tournament.
f. Power used by sanding equipment.
g. Hourly wages of assembly line workers.
h. Boat chairs.
i. Legal department costs for the year.
j. Memberships for key executives in the Bass World Association.
k. Cost of normal scrap from defective hulls.
l. Fiberglass for producing the boat hull.
m. Decals for boat hull.
n. Annual fee to pro-fisherman Jim Bo Wilks to promote the boats.
o. Yearly cost maintenance contract for robotic equipment.
p. Annual bonus paid to top executives of the company.
q. Masks for use by sanders in smoothing boat hulls.
r. Special advertising campaign in Bass World.
s. Cost of metal hardware for boats, such as ornaments and tie-down grasps.
t. Straight-line depreciation on factory equipment.
u. Oil to lubricate factory equipment.
v. Salary of chief financial officer.
w. Canvas top for boats.
x. Wood paneling for use in interior boat trim.
y. Cost of paving the headquarters employee parking lot.
z. Steering wheels.
Classify each cost as either a product cost or a period cost. Indicate whether each product cost is a direct materials cost, a direct labor cost, or a factory overhead cost. Indicate whether each period cost is a selling expense or an administrative expense. Use the following tabular headings for your answer, placing an “X” in the appropriate column.
Direct Materials Cost
Direct Labor Cost
Factory Overhead Cost