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Requirement

Classify each cost item (A-H) as follows:

A) Direct or indirect (D or I) costs of the total number of DVDs sold.

B) Variable or fixed (V or F) costs of how the total costs of the movie section change as the total number of DVDs sold changes. (If in doubt, select on the basis of whether the total costs will change substantially if there is a large change in the total number of DVDs sold.)

COST ITEMS:

A) Annual retainer paid to a DVD distributor (D or I)

B) Cost of store managers salary (D or I)

C) Costs of DVDs purchased for sale to customers (Easily traceable and helps identify what DVDs to stock) (D or I)

D) Subscription to DVD Trends magazine (D or I)

E) Leasing of computer software used for financial budgeting at the BBE store (D or I)

F) Cost of popcorn provided free to all customers of the BBE store (D or I)

G) Cost of cleaning the store every night after closing (D or I)

H) Freight-in costs of DVDs purchased by BBE (D or I)

Homework: Assignment 2: Chpt 2 Intro. to Cost. Terms core: 0 of 25 pts Hw Score: 0%, 0 of 100 pts a. Direct or rdroctD or I) costs ofthe total number of DVDs sold total number of DVDs sold.) o DVD Trends magazine Clear All

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