Question

Trak Corporation incurred the following costs while manufacturing its bicycles.

Bicycle components $100,000
Advertising expense $45,000
Depreciation on plant 60,000
Property taxes on plant 14,000
Property taxes on store 7,500
Delivery expense 21,000
Labor costs of assembly-line workers 110,000
Sales commissions 35,000
Factory supplies used 13,000
Salaries paid to sales clerks 50,000

Required:
Identify each of the above costs as direct materials, direct labor, manufacturing overhead, or period costs.

Answer 1

Please find the answer below.

Step-by-step explanation:

Bicycle components $100,000 - Direct materials

Advertising Expense $45,000 - Period costs

Depreciation on plant $14,000 - manufacturing overhead

Property taxes on plant $14,000 - manufacturing overhead

Property taxes on store $7,500 - manufacturing overhead

Delivery expense $21,000 - period costs

Labor costs of assembly-line workers $110,000 - Direct labor

Sales commissions $35,000 - Period costs

Factory supplies used $13,000 - Period costs

Salaries paid to sales clerks $50,000 - period costs

Cheers.