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Examples of product costs are direct materials, direct labor, and allocated factory overhead. Examples of period costs are general and administrative expenses, such as rent, office depreciation, office supplies, and utilities.
What is an example of a period cost?
Period costs are all costs not included in product costs. Other examples of period costs include marketing expenses, rent (not directly tied to a production facility), office depreciation, and indirect labor. Also, interest expense on a company’s debt would be classified as a period cost.
Which of the following is an example of a period cost quizlet?
Examples of period costs are: Selling expenses. Advertising expenses. What is the difference between product cost and period cost? The product costs of direct materials, direct labor, and manufacturing overhead are also “inventoriable” costs, since these are the necessary costs of manufacturing the products.
Which of the following is a period cost for a manufacturer?
You just studied 79 terms!.
What is the period cost?
A period cost is any cost that cannot be capitalized into prepaid expenses, inventory, or fixed assets. A period cost is more closely associated with the passage of time than with a transactional event. Instead, it is typically included within the selling and administrative expenses section of the income statement.
What is period cost in costing?
Period costs are any costs a company incurs that are not directly related to the production process. This means they are not related to the cost of one product or inventory costs for a business, therefore period costs are included in a company’s financial statement during their assigned accounting period.
Which of the following is an example of a period cost when manufacturing products quizlet?
For a manufacturer, rent paid for an office building is an example of a period cost. Factory rent, taxes, and insurance are included in manufacturing overhead. Direct materials and direct labor are prime costs. In a manufacturing company, administrative costs are included in period costs.
Which of the following costs is not a period cost?
The correct answer is C) Cost of Goods Sold.
Which of the following is an example of a direct cost quizlet?
Examples of direct costs are direct labor, direct materials, commissions, piece rate wages, and manufacturing supplies. You just studied 36 terms!Sep 11, 2018.
Which of the following are product cost for a manufacturer?
In manufacturing companies, a product’s cost is made up of three cost elements: direct material costs, direct labor costs, and manufacturing overhead costs.
Which of the following is an example of a fixed cost for a manufacturer?
Fixed costs will be similar to those in a manufacturing facility. Administrative wages, rent, property taxes and utilities are all going to be fixed. These will exist whether the retail store sells one item or thousands!.
Which of the following is an example of a variable cost for a manufacturing firm?
Examples of variable costs are sales commissions, direct labor costs, cost of raw materials used in production, and utility costs.
Which of the following is an example of a period cost when manufacturing products?
Examples of product costs are direct materials, direct labor, and allocated factory overhead. Examples of period costs are general and administrative expenses, such as rent, office depreciation, office supplies, and utilities.
Is electricity a period cost?
Utilities: Expenses such as gas and electric are considered a period cost, unless they directly involve the manufacturing plant. Like rent, if administrative and factory facilities are under one roof, utility costs must be allocated according to the space used by each.
Is R&D a period cost?
Period costs are basically all costs other than product costs. Period costs are thus expensed in the period in which they are incurred. Example of period costs are advertising, sales commissions, office supplies, office depreciation, legal and research and development costs.
Is indirect materials a period cost?
Indirect materials can be accounted for in one of two ways: They are included in manufacturing overhead, and are allocated to the cost of goods sold and ending inventory at the end of each reporting period based on some reasonable method of allocation. They are charged to expense as incurred.
Are wages period or product cost?
Period Costs Product Costs Period Costs Comprises of: Manufacturing and production costs Non-manufacturing costs Examples Raw material, wages on labor, production overheads, rent on the factory, etc. Marketing costs, sales costs, audit fees, rent on the office building, etc.
Which of the following is an example of direct labor cost?
Examples of direct labor costs include the following: In a manufacturing setting, wages paid to workers in an assembly line. In a service setting, wages paid to workers in the kitchen of a restaurant.
Which of the following is an example of a factory overhead cost?
Some examples of manufacturing overhead costs include the following: depreciation, rent and property taxes on the manufacturing facilities. depreciation on the manufacturing equipment. managers and supervisors in the manufacturing facilities.
Which of the following would be considered a product cost?
Product cost refers to the costs incurred to create a product. These costs include direct labor, direct materials, consumable production supplies, and factory overhead. Product cost can also be considered the cost of the labor required to deliver a service to a customer.
Which of the following costs is not considered a period cost warehousing costs?
The correct answer is d. Freight paid on a purchase of raw materials. Since this covers the cost of something that will be used in production, it is a product cost, rather than a period cost.
Which of the following is not a product cost?
Answer and Explanation: The correct answer is D. Cost accountant’s salary is not considered product cost because product cost is those expenses incurred in the production process of a product sold to the customers. Direct material, direct labor, and manufacturing overhead are all included in product costs.
Is property tax a period cost?
Period costs are expensed in the period incurred and not matched with product revenue. Selling and administrative expenses are period costs. The other product costs are materials used in products, labor costs of assembly line workers, factory supplies used, property taxes on the factory, and factory utilities.
Which of the following is an example of direct costs?
Examples of direct costs are direct labor, direct materials, commissions, piece rate wages, and manufacturing supplies. Examples of indirect costs are production supervision salaries, quality control costs, insurance, and depreciation.
Which of following is direct cost?
A direct cost can be traced to the cost object, which can be a service, product, or department. Direct costs examples include direct labor and direct materials. Although direct costs are typically variable costs, they can also be fixed costs.
Which is an example of indirect costs quizlet?
Indirect costs include administration, personnel and security costs. The smaller the amount of a cost (the more immaterial the cost is) the less likely it is economically feasible to trace it to a particular cost object. Make it possible to consider more and more costs as direct costs.
What are the 3 types of cost?
The types are: 1. Fixed Costs 2. Variable Costs 3. Semi-Variable Costs.
