Essay
Classification of costs
Using the code letters below,indicate in the space provided how each of the following costs should be classified in the indicated manufacturing company:
Costs
____ (a)Research and development costs incurred by Martin,manufacturer of derailleurs,brakes,and other component parts for bicycles in its efforts to develop new products.
____ (b)Salaries paid by Martin to the plant managers supervising production operations.
____ (c)An inventory of Martin Group 105 components purchased by Earl Bicycle Corporation for use in the manufacture of Earl's Model 1200 aluminum bicycle.
____ (d)An inventory of Model 1200 bicycle frames manufactured by Earl.Prior to sale,these frames will be painted and equipped with derailleurs,brakes,and other component parts.
____ (e)Salaries paid by Earl to its sales personnel.
____ (f)Salaries paid by Earl to employees who install derailleurs,brakes,and other component parts on the bicycle frames.
____ (g)An inventory of Martin Group 105 derailleurs awaiting sale to customers.
Correct Answer:

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