Transportation costs incurred by a manufacturing company to ship its product to its customers would be classified as which of the following?
A) Product cost
B) Manufacturing overhead
C) Period cost
D) Administrative cost

Question

Quizplus · Accepted Answer

Transportation costs are considered a period cost because they are incurred after the manufacturing process is completed and the product is ready to be shipped to customers. Period costs are expensed in the period they are incurred and are not included in the cost of goods sold.

Transportation Costs Incurred by a Manufacturing Company to Ship Its