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yuradex [85]
3 years ago
14

ndicate whether each of the following costs should be classified as a product cost or as an SG&A cost in accordance with GAA

P: Direct materials used in a manufacturing company. Indirect materials used in a manufacturing company. Salaries of employees working in the accounting department. Commissions paid to sales staff. Interest on the mortgage for the company’s corporate headquarters. Indirect labor used to manufacture inventory. Attorney’s fees paid to protect the company from frivolous lawsuits. Research and development costs incurred to create new drugs for a pharmaceutical company. The cost of secretarial supplies used in a doctor’s office. Depreciation on the office furniture of the company president.
Business
1 answer:
Leokris [45]3 years ago
4 0

Answer:

 

Explanation:

The product cost is a combination of direct material cost, direct labor cost, and the manufacturing overhead cost. The manufacturing overhead cost is an indirect cost which is related to the factory expenses.

And, the SG&A cost is a sales, general ,and admin costs incurred to advertise the company's products so that it can accomplish its sales targets which can build a good reputation in the market.

So, the categorization is shown below:

Direct materials used in a manufacturing company. = Product cost

Indirect materials used in a manufacturing company. = Product cost

Salaries of employees working in the accounting department. = sales, general ,and admin costs

Commissions paid to sales staff. = sales, general ,and admin costs

Interest on the mortgage for the company’s corporate headquarters. = sales, general ,and admin costs

Indirect labor used to manufacture inventory. = Product cost

Attorney’s fees paid to protect the company from frivolous law suits. = sales, general ,and admin costs

Research and development costs incurred to create new drugs for a pharmaceutical company. = sales, general ,and admin costs

The cost of secretarial supplies used in a doctor’s office. = sales, general ,and admin costs

Depreciation on the office furniture of the company president. = sales, general ,and admin costs

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saveliy_v [14]

Answer:

b. can be tailored to the needs of the internal user.

Explanation:

Managerial accounting information is basically for internal users, and is not aimed to provide information to external users. It aims of future projections.

It need not follow the US GAAP process, as there is no statutory requirement.

Shareholders are considered external for this purpose, as internal ones are, management, employees, labor etc:

Therefore, it does not help shareholders.

It does not report any kind of business results, it only aims to regulate transactions and accordingly planning future goals.

Therefore, correct option is

b. can be tailored to the needs of the internal user.

7 0
2 years ago
Samir, the new CEO of Cloud Marketing, has been with the firm for over 25 years. He was picked by the board to turn the 85-year-
IRISSAK [1]

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Explanation:

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2 years ago
In risk management what does risk evaluation involve?
Naddik [55]
C) risk prioritizing
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3 years ago
Fred Stone is an employee of Henrock Company. During the first part of the year, Stone earned $4,340 while working in State Q. F
lyudmila [28]

Answer:

$280

Explanation:

SUTA is a synonym for State Unemployment Tax paid by employers and employees , and used by the government to provide the insurance expenditures for the unemployed citizens

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MaRussiya [10]

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Explanation:

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