Reference:
Charlie's Chocolate Factory manufactures chocolate bars and ships them directly to wholesalers and retailers across the country. The company has two product lines: milk chocolate bars and chocolate covered almonds. Classify the following company's expenses if the cost object is a single product line (either milk chocolate bars or chocolate covered almonds).
-Advertising campaign for chocolate covered almonds.
A)Indirect product cost.
B)Direct product cost.
C)Direct period cost.
D)Indirect period cost.

Question

Quizplus · Accepted Answer

The advertising campaign is a period cost as it relates to a specific period of time and is not directly related to the production of a specific product line. However, it is a direct cost because it is specifically related to the chocolate covered almonds product line.

Reference: Charlie's Chocolate Factory Manufactures Chocolate Bars and Ships Them Directly