Name _______ _________ (Please include your name in the file.)
I. Classifications (30 points total)

Part A: Classifications (2 points each – 22 points total)
Determine the classification for each cost item based on 2 different schemes. First, determine cost behavior: whether the cost is variable or fixed (relative to the number of units produced); check the appropriate space. Then, determine whether the cost is a product or a period cost; check the appropriate space. Be sure your final answers are lined up under the right column before submitting your quiz.

Behavior Functional Area
Cost Item Variable Fixed Product Period

Paper towels used in the office building restrooms _____ _ √ _ _____ _ √ _

Cost of natural gas to run the manufacturing equipment _ √ _ _____ _ √ _ _____

Salaries of the sales managers _____ _ √ _ _____ _ √ _

Insurance paid on the headquarters building _____ _ √ _ _____ _ √ _

Hourly wages of the assembly workers _ √ _ _____ _ √ _ _____

Cost of fabric to make polo shirts _ √ _ _____ _ √ _ _____

Commissions paid to salespeople at $4 per unit _ √ _ _____ _____ _ √ _

Production supervisors’ salaries _____ _ √ _ _ √ _ _____

Cost of newspaper advertising _____ _ √ _ _____ _ √ _

Property taxes paid on the factory building _____ _ √ _ _ √ _ _____

Cost of forms for ordering raw materials _ √ _ _____ _ √ _ _____ (purchase orders)

Part B: Identification of cost types (2 pts each – 8 point total)
Select from the list above (in Part A) and list below two items that would be classified as:

1.