The PC Works assembles custom computers from components supplied by various manufacturers. The company is very small and its assembly shop and retail sales store are housed in a single facility in a Redmond, Washington, industrial park. Listed below are some of the costs that the company incurs.

 The PC Works assembles custom computers from components supplied by various manufacturers. The company is very small and its assembly shop and retail sales store are housed in a single facility in a Redmond, Washington, industrial park. Listed below are some of the costs that the company incurs.

 

Required:

For each cost, indicate whether it would most likely be classified as direct materials, direct labor, manufacturing overhead, selling, or an administrative cost.

 

1. The cost of a hard drive installed in a computer.

 

multiple choice 1
Direct labor cost
Direct materials cost Correct
Manufacturing overhead cost
Selling cost
Administrative cost

 

 2. The cost of advertising in the Puget Sound Computer User newspaper.

 

multiple choice 2
Direct labor cost
Direct materials cost
Manufacturing overhead cost
Selling cost Correct
Administrative cost

 

3. The wages of employees who assemble computers from components.

 

multiple choice 3
Direct labor cost Correct
Direct materials cost
Manufacturing overhead cost
Selling cost
Administrative cost

 

4. Sales commissions paid to the company’s salespeople.


multiple choice 4
Direct labor cost
Direct materials cost
Manufacturing overhead cost
Selling cost Correct
Administrative cost

 

5. The salary of the assembly shop’s supervisor.

 

multiple choice 5
Direct labor cost
Direct materials cost
Manufacturing overhead cost Correct
Selling cost
Administrative cost

 

6. The salary of the company’s accountant.

 

multiple choice 6
Direct labor cost
Direct materials cost
Manufacturing overhead cost
Selling cost
Administrative cost Correct

 

7. Depreciation on equipment used to test assembled computers before release to customers.

 

multiple choice 7
Direct labor cost
Direct materials cost
Manufacturing overhead cost Correct
Selling cost
Administrative cost

Explanation
No further explanation details are available for this problem.