Classify each of the costs as a direct cost or an indirect cost to the motor manufacturing cell.
Exercise 2-30 Total and Unit Product Cost
Martinez Manufacturing Inc. showed the following costs for last month:
Direct materials $7,000
Direct labor $3,000
Manufacturing overhead $2,000
Selling expense $8,000
Last month, 4,000 units were produced and sold.
Required:
1. Classify each of the costs as product cost or period cost.
Direct materials - Product Cost
Direct labor - Product Cost
Manufacturing overhead - Product Cost
Selling expense -Period Cost
2. What is total product cost for last month?
3. What is the unit product cost for last month?

Use the following information for Exercises 2-39 through 2-41.
Jasper Company provided the following information for last year:
Sales in units 280,000
Selling price $ 12
Direct materials 180,000
Direct labor 505,000
Manufacturing overhead 110,000
Selling expense 437,000
Administrative expense 854,000
Last year, beginning and ending inventories of work in process and ?nished goods equaled zero.
Jasper Company
Income Statement 2014

Sales in Units $280,000 100%

Exercise 2-41 Income Statement
Refer to the information for Jasper Company above.
Required:
1. Prepare an income statement for Jasper for last year. Calculate the percentage of sales for each line item on the income statement. (Note: Round percentages to the nearest tenth of a percent.)
2. CONCEPTUAL CONNECTION brie?y explain how a manager could use the income statement created for Requirement 1 to better control costs.








Exercise 3-20 Variable and Fixed Costs
What follows are a number of resources that are used by a manufacturer of futons. Assume that the output measure or cost driver is the number of futons produced. All direct labor is paid on an hourly basis, and hours worked can be easily changed by management. All other factory workers are salaried.
a. Power to operate a drill (to drill holes in the wooden frames of the futons)
b. Cloth to cover the futon mattress
c. Salary of the factory receptionist
d. Cost of food and decorations for the annual Fourth of July party for all factory employees
e. Fuel for a forklift used to move materials in a factory
f. Depreciation on the factory
g. Depreciation on a forklift used to move partially completed goods
h. Wages paid to workers who assemble the futon frame
i. Wages paid to workers who maintain the factory equipment
j. Cloth rags used to wipe the excess stain off the wooden frames



Exercise 3-23 Cost Behavior
Refer to the information for Alisha Incorporated above.
Required:
1. What is the total maintenance cost incurred by Alisha last year?
2. What is the total ?xed maintenance cost incurred by Alisha last year?
3. What is the total variable maintenance cost incurred by Alisha last year?
4. What is the maintenance cost per unit produced?
5. What is the ?xed maintenance cost per unit?
6. What is the variable maintenance cost per unit?
7. CONCEPTUAL CONNECTION Brie?y explain how Alisha management could improve its cost function to better understand past maintenance costs and predict future maintenance costs.

Problem 3-42 Identifying Variable Costs, Committed Fixed Costs, and Discretionary Fixed Costs
Required:
Classify each of the following costs for a jeans manufacturing company as a variable cost, committed ?xed cost, or discretionary ?xed cost.
a. The cost of buttons
b. The cost to lease warehouse space for completed jeans-the lease contract runs for 2 years at $5,000 per year
c. The salary of a summer intern
d. The cost of landscaping and mowing the grass-the contract with a local mowing company runs from month to month
e. Advertising in a national magazine for teenage girls
f. Electricity to run the sewing machines
g. Oil and spare needles for the sewing machines
h. Quality training for employees-typically given for four hours at a time, every six months
i. Food and beverages for the company Fourth of July picnic
j. Natural gas to heat the factory during the winter