The period cost, which consists the income statement of manufacturing companies belong to ____________?
Correct answer: C. non-manufacturing costs
- A. inventory costs
- B. product costs
- C. non-manufacturing costs
- D. manufacturing costs
Explanation
Period costs are charged to the income statement in the period incurred rather than being attached to inventory. In manufacturing, selling and administrative expenses are the main non-manufacturing period costs.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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