Jeelani Construction Company is composed of two divisions: (1) Home Construction and (2) Commercial Construction. The Home Construction Division is in the process of building 12 houses and the Commercial Construction Division is working on 3 projects. Cost items of the company follow.
- Company president's salary
- Depreciation on crane used in commercial construction
- Depreciation on home office building
- Salary of corporate office manager
- Wages of workers assigned to a specific construction project
- Supplies used by the Commercial Construction Division
- Labor on a particular house
- Salary of the supervisor of commercial construction projects
- Supplies, such as glue and nails, used by the House Construction Division
- Cost of building permits
- Materials used in commercial construction projects
Depreciation on home building equipment (small tools such as hammers or saws)
Required
A. Identify each cost as being a direct or indirect cost assuming the cost objects are individual products (houses or projects).
B. Identify each cost as being a direct or indirect cost, assuming the cost objects are the two divisions.
C. Identify each cost as being a direct or indirect cost, assuming the cost object is Jeelani Construction Company as a whole.