The following information is taken from the records of the Carolby Company, a manufacturer of lawn furniture. Indicate whether the cost of each item should be included as part of the finished goods cost or should be treated as an expense. For the items that become part of the cost of finished goods, indicate whether each should be designated as materials, labor, or factory overhead.

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a. Salaries of sales office staff
b. Electric utilities for the factory area
c. Office supplies
d. Paint and miscellaneous plastic parts
e. Depreciation on factory equipment
f. Depreciation on delivery vans
g. Salaries of factory foremen
h. Miscellaneous factory supplies
i. Steel rods used for chair frames
j. Plastic sheets used for table tops
k. Salaries of furniture assemblers
l. Insurance on the factory
m. Insurance on the administrative offices
n. Advertising in trade magazines
o. Lawn furniture sold to retailers
p. Rental of storage facilities for materials
q. Rental of storage facilities for finished goods
Required
Briefly explain your reasoning for classifying the various items as part of the cost of goods manufactured or as an expense.