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1. Classify each cost and its amount as (a) either variable or fixed and (b) either product or period. (The first cost is completed as an example.)
2. Calculate the manufacturing cost per drum set.
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Listed here are the total costs associated with the 2017 production of 1,000 drum sets manufactured by TrueBeat. The drum sets sell for $493 each.
| | Costs |
| 1. | Plastic for casing$20,000 |
| 2. | Wages of assembly workers$88,000 |
| 3. | Property taxes on factory$7,000 |
| 4. | Accounting staff salaries$36,000 |
| 5. | Drum stands (1,000 stands purchased)$38,000 |
| 6. | Rent cost of equipment for sales staff$12,000 |
| 7. | Upper management salaries$175,000 |
| 8. | Annual flat fee for factory maintenance service$13,000 |
| 9. | Sales commissions$24 per unit |
| 10. | Machinery depreciation, straight-line$48,000 |
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