ABC company manufactures specialty X-ray equipment in their Detroit plant. The equipment is used in hospitals throughout the US. ABC company has a salesforce that visits hospitals and meets with doctors to market their equipment and increase sales of the equipment. ABC incurred the following costs in their normal business operations. Identify each of the following costs as product costs or period costs. You should submit a text box for your answer classifying 1-10 below as product cost or period cost. 1. Tubes used in manufacturing the product. 2. Wages of factory workers in the Detroit plant. 3. Wages of salesforce. 4. Factory supervisors' salary. 5. Wages of the receptionist in the administrative offices. 6. Rent on the factory. 7. Advertising costs related to the promotion of the product. 8. The cost of renting hotel rooms for the salesforce when traveling out of town travel to various hospitals to market the product. 9. Heat used in the factory. 10. Heat used in the administrative and sales offices.
1. Tubes used in manufacturing the product: Product cost
2. Wages of factory workers in the Detroit plant: Product cost
3. Wages of salesforce: Period cost
4. Factory supervisors' salary: Product cost
5. Wages of the receptionist in the administrative offices: Period cost
6. Rent on the factory: Product cost
7. Advertising costs related to the promotion of the product: Period cost
8. The cost of renting hotel rooms for the salesforce when traveling out of town to various hospitals to market the product: Period cost
9. Heat used in the factory: Product cost
10. Heat used in the administrative and sales offices: Period cost