Question

Custom Quilters makes decorative comforters, quilted garments, and other products in a small sewing factory. The company expects to make 2,000 comforters during the current year. With respect to the comforters, how would the supervisory salaries be classified? Multiple Choice Direct and variable Direct and fixed Indirect and variable Indirect and fixed

Answer 1

Answer:

Indirect and fixed

Explanation:

Indirect costs are those cost which cannot be directly attributable to any product.

Fixed costs are those which remains the same in the period whatever the level of activity (production, sales etc.) is. It does not vary with the change in the activity level.

Supervisor salaries cannot be traceable directly to any specific product, so it is considered as the indirect cost. As the Salaries are fixed payments made on monthly or annually basis, So it is also classified as the fixed cost.

Answer 2

Answer:

The supervisor's salaries is indirect and fixed

Explanation:

The cost of all materials to be used which also go into the product is called direct material cost and labour working direct

the cost of al workers actively involved directly in the manufacturing  od the decorative comforters are called direct labour cost.

All labor and materials costs  other than the direct  costs are called indirect cost of overheads.

For example, the cost of all workers other than the direct workers like the supervisor salaries. The supervisor is an indirect worker for which the benefits of his work cannot be traced to a particular product since the company produces more than one

Also his salaries do not vary with volume of the products produced. Hence, it is a fixed cost

Therefore the supervisor's salaries is indirect and fixed