Kam Saved Help Save & Exit Case 1-26 (Algo) Cost Classification and Cost Behavior (L01-1, L01-2, L01-3, L01-4) The Dorilane Company produces a set of wood patio furniture consisting of a table and four chairs. The company has enough customer demand to justify producing its full capacity of 4,200 sets per year. Annual cost data at full capacity follow Direct labor Advertising Factory supervision Property taxes, factory building Sales comissions Insurance, factory Depreciation, administrative office equipment Lease cost, factory equipment Indirect materials, factory Depreciation, factory building Administrative office supplies (billing) Administrative office salaries Direct materials used (wood, bolts, etc.) utilities, factory $ 80,000 $ 99,000 $ 67,000 $ 25,000 $ 64,000 $ 8,000 52,00 $ 19,900 $ 18,00 $109,000 $ ,000 $ 106,000 $426,000 $ 40,000 Required: 1. Enter the collar amount of each cost item under the appropriate headings. Note that each cost item is classified in two ways, first, as variable or fixed with respect to the number of units produced and sold, and second, as a selling and administrative cost or a product cost. (If the item is a product cost , it should also be classified as either direct or indirect) 2 Compute the average product cost of one patio set 3. Assume that production drops to only 1,000 sets annually. Would you expect the average product cost per set to increase, decrease, or remain unchanged? product cost, it should also be classified as either direct or indirect.) Cost Behavior Product Cosi Period (Selling 01 Administrative COS Cost Item Variable Fixed Direct Indinect $ 88,000 99,000 67,000 25,000 64.000 8,000 2.000 Direct labor Advertising Factory supervision Property taxes, factory building Sales commissions Insurance, factory Depreciation, administrative office equipment Lease cost, factory equipment Indirect materials, factory Depreciation, factory building Administrative office supplies (billing) Administrative office salaries Direct materials used (wood, bolts, etc.) Utilities, factory Total costs 0 0 0 01 $ 152 000 $ 201,000 $ Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Compute the average product cost of one patio set. (Round your final answer to nearest whol Average product cost $ 206 per set 0:41 20 Required 1 Required 2 Required 3 bok Assume that production drops to only 1,000 sets annually. Would you expect the ave decrease, or remain unchanged? Increase O Decrease ORemain unchanged