Everything Umbrella Inc. is considering producing a new type of umbrella. This new pocket-sized umbrella would fit into a coat pocket or purse.
Prepare a table with three columns to include the following information:
- Classify the costs of this new product as direct materials, direct labor, manufacturing overhead, selling, or administrative.
- Classify the costs listed as either product costs or period costs.
List of expenses incurred by Everything Umbrella Inc.
- Cost of advertising the product.
- Fabric used to make the umbrellas.
- Maintenance of cutting machines used to cut the umbrella fabric so it will fit the umbrella frame.
- Wages of workers who assemble the product.
- President’s salary.
- The salary of the supervisor of the people who assemble the product.
- Wages of the product tester who stands in a shower to make sure the umbrellas do not leak.
- Cost of market research survey.
- Salary of the company’s sales managers.
- Depreciation of administrative office building.
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