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    Classification of costs: variable or not

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    Stewart Company is attempting to classify costs according to their cost behavior. Data concerning activity and costs are listed below:

    January February
    Sales in units........... 1,200 1,400

    Maintenance........... $ 600 $ 700
    Supplies.................. 750 790
    Insurance................ 800 800
    Utilities.................... 888 1,036
    Lubrication.............. 560 576
    Advertising.............. 900 1,050
    Total....................... $4,498 $4,952

    maintenance and supplies
    maintenance, supplies, utilities, lubrication and advertising
    supplies and advertising
    maintenance, utilities and advertising

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    Solution Preview

    Although there isn't much direction about where to go with the question, I ...

    Solution Summary

    The solution explains the rationale for dividing costs between variable or fixed costs.

    $2.19

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