Bonita Company manufactures a single product. Annual production costs incurred in the manufacturing process are shown below for two levels of production.

Bonita Company manufactures a single product. Annual production costs incurred in the manufacturing process are shown below for two levels of production.

		Costs Incurred
Production in Units		5,000				10,000
Production Costs		Total Cost		Cost/Unit		Total Cost		Cost/Unit
Direct materials		$8,000		$1.60		$16,000		$1.60
Direct labor		9,500		1.90		19,000		1.90
Utilities		2,000		0.40		3,300		0.33
Rent		4,000		0.80		4,000		0.40
Maintenance		800		0.16		1,400		0.14
Supervisory salaries		1,000		0.20		1,000		0.10

(b)

Classify each cost above as either variable, fixed, or mixed.

Production Costs
Direct materials		Variable Mixed Fixed
Direct labor		Mixed Variable Fixed
Utilities		Variable Mixed Fixed
Rent		Mixed Fixed Variable
Maintenance		Mixed Variable Fixed
Supervisory salaries		Fixed Variable Mixed

Family Furniture Corporation incurred the following costs.

Identify the costs as variable, fixed, or mixed.

1.		Wood used in the production of furniture.		Variable Fixed Mixed
2.		Fuel used in delivery trucks.		Mixed Variable Fixed
3.		Straight-line depreciation on factory building.		Mixed Fixed Variable
4.		Screws used in the production of furniture.		Fixed Mixed Variable
5.		Sales staff salaries.		Fixed Mixed Variable
6.		Sales commissions.		Mixed Fixed Variable
7.		Property taxes.		Fixed Mixed Variable
8.		Insurance on buildings.		Mixed Variable Fixed
9.		Hourly wages of furniture craftsmen.		Variable Fixed Mixed
10.		Salaries of factory supervisors.		Mixed Fixed Variable
11.		Utilities expense.		Variable Mixed Fixed
12.		Telephone bill.		Variable Fixed Mixed