Problem 01-2A Classifying costs LO C2, C3 The following calendar year-end information is taken from the December 31, 2019, adjusted trial balance and other records of Leone Company. Advertising expense $28,750
Depreciation expense—Office equipment 7,250
Depreciation expense—Selling equipment 8,600
Depreciation expense—Factory equipment 33,550
Factory supervision 102,600
Factory supplies used (indirect materials) 7,350
Factory utilities 33,000
Direct labor 675,480
Indirect labor 56,875
Miscellaneous production costs 8,425
Office salaries expense 63,000
Raw materials purchases (direct) 925,000
Rent expense—Office space 22,000
Rent expense—Selling space 26,100
Rent expense—Factory building 76,800
Maintenance expense—Factory equipment 35,400
Sales 4,462,500
Sales salaries expense 392,560
Required:
Classify each of the costs as either a product or period cost. Then, classify each of the product costs as either direct materials, direct labor, or factory overhead and each of the period costs as either selling or general and administrative expenses.

Part 1

a. Period Cost

Advertising expense $28,750

Depreciation expense—Office equipment $7,250

Depreciation expense—Selling equipment $8,600

Office salaries expense $63,000

Rent expense—Office space $22,000

Rent expense—Selling space 26,100

Sales salaries expense $392,560

b. Product Cost

Depreciation expense—Factory equipment $33,550

Factory supervision $102,600

Factory supplies used (indirect materials) $7,350

Factory utilities $33,000

Direct labor $675,480

Indirect labor $56,875

Miscellaneous production costs $8,425

Raw materials purchases (direct) $925,000

Rent expense—Factory building $76,800

Maintenance expense—Factory equipment $35,400

Part 2

a. Direct material

Raw materials purchases (direct) $925,000

b. Direct Labor

Direct labor $675,480

c. Factory overhead

Depreciation expense—Factory equipment $33,550

Factory supervision $102,600

Factory supplies used (indirect materials) $7,350

Factory utilities $33,000

Indirect labor $56,875

Miscellaneous production costs $8,425

Rent expense—Factory building $76,800

Maintenance expense—Factory equipment $35,400

Part 3

a. selling expense

Advertising expense $28,750

Depreciation expense—Selling equipment $8,600

Rent expense—Selling space $26,100

Sales salaries expense $392,560

b. general and administrative

Depreciation expense—Office equipment $7,250

Office salaries expense $63,000

Rent expense—Office space $22,000

Explanation:

Period Costs comprises all manufacturing costs and are used for inventory valuation. Period costs comprises of all non-manufacturing costs and are expensed in the income statement.

Overhead Costs are Manufacturing costs that can not be traced directly to the product being manufactured. They need to be apportioned using cost drivers to the products or cost centers.

answer; communities of interest; i believe this is correct, plz check first good luck;

answerstakeholders;