Suppose you have been given a summer job at fairwings Avionics a company that manufactures sophisticated reader set for commercial aircraft. The company which is private owned has approached a bank for loan to help finance its tremendious growth.The bank requires financial statements before approving such a loan.
Classify each cost listed below as either a product cost or period cost for preparing financial statements for bank.
1. Cost of the memory chips used in a radar set.
2. Factory heating costs.
3. Factory equipment maintenance costs.
4. Training costs for new administrative costs.
5. The cost of the solder that is used is assembling the radar sets.
6. The travel cost of the company sales persons.
7. Wages and salaries of factory security personnels.
8. The cost of air conditioning executive offices.
9. Wages and salaries in the department that handles billing customers.
10. depreciation on the equipment in the fitness room used by factory worketrs
11. Telephone expense incurred by factory management.
12. The cost of shipping completed radar sets to customers.
13. The wages of the workers who assemble the radar sets.
14. The presidents Salary.
15. Health insurance premiums for factory personnels.
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