Inventoriable costs are costs of a product that are considered ________.
A) assets in a company's balance sheet when the costs are incurred and that are expensed as cost of goods sold only when the product is sold
B) liabilities in a company's balance sheet when the costs are incurred and that are expensed only when the product is sold
C) assets in a company's income statement when the costs are capitalized and that are expensed as cost of goods sold only when the product is sold
D) liabilities in a company's income statement when the costs are capitalized and that are expensed only when the product is sold

Question

Quizplus · Accepted Answer

Inventoriable costs are considered as assets in a company's balance sheet when the costs are incurred and only expensed as cost of goods sold when the product is sold. This is because these costs are directly related to the production of the inventory and should be carried as an asset until the inventory is sold.

Inventoriable Costs Are Costs of a Product That Are Considered