Anchor Calendar Company Manufactures Wall and Desktop Calendars for Business

Essay

Anchor Calendar Company manufactures wall and desktop calendars for business use.The company expects production of 20,000 units this year.Various costs and items associated with calendar production are described below:
$\begin{array}{|l|l|c|c|c|}\hline \text { Item } & \text { Direct } &\text { Indirect} & \text { Fixed } & \text { Variable }\\\hline \text { Purchase cost of paper } & \\\hline \text { Assembly labor costs } & \\\hline \text { Supervisory labor costs } & \\\hline \text { Depreciation on paper cutting machines } & \\\hline \text { Depreciation on factory building } & \\\hline \text { Maintenance on machine (performed between } & \\\text { batches of products) } & \\\hline \text { Materials used in small amount, such as glue } & \\\hline \text { Factory rental costs } & \\\hline\end{array}$ Required:
Assume that management is interested in determining the average cost per calendar.For each item in the table,place a check mark or X in every column that applies.When labeling costs as fixed or variable,select your response on the basis of whether the total cost of that item will change when changes occur in volume of calendars produced.