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).
-Shipping costs to send the finished milk chocolate bars and chocolate covered almonds to wholesalers.
A)Direct period cost.
B)Indirect period cost.
C)Indirect product cost.
D)Direct product cost.

Question

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).
-Shipping costs to send the finished milk chocolate bars and chocolate covered almonds to wholesalers.
A)Direct period cost.
B)Indirect period cost.
C)Indirect product cost.
D)Direct product cost.

Quizplus · Accepted Answer

Shipping costs to send finished products to wholesalers are indirect period costs because they relate to the overall operation of the company and not directly to the production of a single product line.

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