Solution for Required: 1. Enter the dollar amount of each cost item under the appropriate headings. Note that each cost item is classified in two ways: first,…
Required:1. Enter the dollar amount of each cost item under the appropriate headings. Note that each cost item is classified in two ways: first, aseither variable or fixed with respect to the number of units produced and sold, and second, as either a selling and administrative costor a product cost. (If the item is a product cost, it should also be classified as either direct or indirect.)Cost ItemDirect labourAdvertisingFactory supervisionProperty taxes, factory buildingSales commissionsInsurance, factoryDepreciation, administrative office equipmentLease cost, factory equipmentIndirect materials, factoryDepreciation, factoryAdministrative office suppliesDirect materials used (wood, bolts, etc.)Utilities, factoryTotal costsAverage product cost$Cost BehaviorVariableO IncreaseO DecreaseO Remain unchanged0 $per patio setFixedSelling andAdministrativeCost0 $2. Compute the average product cost per patio set. (Round your answer to 2 decimal places.)0 $Product CostDirect0 $Indirect03. Due to reduced demand, assume that production drops to only 1,000 sets per year. Would you expect the average product cost perpatio set to increase, decrease, or remain unchanged? The Outdoor Dining Company specializes in producing aset of wood patio furniture consisting of a table and fourchairs. The set enjoys great popularity, and the companyhas ample orders to keep production going at its fullcapacity of 2,000 sets per year. Annual cost data at fullcapacity follow:Direct labourAdvertisingFactory supervisionProperty taxes, factory buildingSales commissionsInsurance, factoryDepreciation, administrative office equipmentLease cost, factory equipmentIndirect materials, factoryDepreciation, factoryAdministrative office suppliesDirect materials used (wood, bolts, etc.)Utilities, factory$$$$Ś$$$$Ś$$$180,20037,30046,9006,90054,3002,9003,20013,9002,70022,4001,90052,20025,700
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