Section I: Cost Classifications
Evergrande Hotel is a popular hotel in Kota Kinabalu, Sabah. The cost object of the hotel is the hotel guest. Below is a partial list of the Evergrande Hotel’s costs:
Costs
Direct cost
Indirect cost
(a) Cost of food for guests
(b) Cost of room mini-bar supplies
(c) Training for hotel restaurant servers
(d) Cost to paint hotel lobby
(e) Cost of laundering towels and bedding
(f) Cost of drinks for guests
(g) Depreciation of the hotel
(h) Cost of valet parking
(i) Wages of bellboys
(j) Cost to replace lobby furniture
(k) Wages of hotel housekeepers
(l) Cost of new carpeting
(m) Guest room telephone costs for long-distance calls
(n) Cost of soaps and shampoos for rooms
(o) Wages of kitchen employees
Instruction:
(a) Identify whether each of the costs is to be classified as direct or indirect. Put X in the direct cost column or indirect cost column.