Asked by clara batista on Jun 13, 2024
Verified
Each of the following would be a period cost except:
A) the salary of the company president's secretary.
B) sales commissions.
C) the cost of a general accounting office.
D) depreciation of a machine used in manufacturing.
Period Cost
Costs that are expensed in the period in which they are incurred, not directly tied to the production process.
Manufacturing Overhead
All manufacturing costs that are not direct materials or direct labor, including indirect materials, indirect labor, and other production-related expenses.
- Understand the distinctions between product costs and period costs.
Verified Answer
AA
Ahmed AlghamdiJun 18, 2024
Final Answer :
D
Explanation :
Period costs are those costs that are not associated with the manufacturing of a product, such as selling and administrative expenses. While A, B, and C are examples of period costs, D is not because it relates directly to the manufacturing process. Depreciation of a machine used in manufacturing is a product cost, as it is part of the cost of producing the product.
Learning Objectives
- Understand the distinctions between product costs and period costs.