Which of the following is included in inventory costs?
A) Product costs.
B) Period costs.
C) Product and period costs.
D) Neither product or period costs.

Question

Quizplus · Accepted Answer

Inventory costs refer to the cost of acquiring, storing and selling products. Product costs include direct materials, direct labor, and manufacturing overhead costs associated with the production of inventory. Period costs, on the other hand, are unrelated to the production of inventory and include expenses such as advertising, salaries, and rent. Therefore, only product costs are included in inventory costs.

Which of the Following Is Included in Inventory Costs