Reference no: EM132653579

A perfume manufacturing company has created a new fragrance and it is studying the production and marketing of this innovation on a large scale. The company will rent a factory for $14,000 per month for production. This manufacturer has already taken an advanced course in perfume composition to help him create fragrances. The course cost was $15,000. The company will pay a bill for renting and insuring the production equipment at a monthly cost of $8,000. The company has estimated the following costs: direct materials per unit will be $25 and direct labor will be $20 per unit. Time to be spent promoting the perfume will cost $12,400 per month. In addition, $20,000 of the salary of the existing sales manager will be allocated to the fragrance.

Problem 1: Classify the costs by completing the table below by placing an "X" in a box that matches a cost item to the appropriate cost classification. A cost item may be classified under more than one classification and in that case, you may place more than one "X" for those cost items. Similar, cost classifications may include more than one cost item, in which case those cost classifications may have more than one "X