Which of the following is a period cost?
A)Direct material.
B)Advertising expense.
C)Indirect Labor.
D)Miscellaneous supplies used in production activities.
E)Both "B" and "C."

Question

Quizplus · Accepted Answer

A period cost is one that is not directly related to the production of goods or services. Advertising expense is a period cost because it is incurred to promote the company as a whole and not for any specific product. Direct material and indirect labor are both examples of product costs, which are costs that are directly related to the production of goods or services. Miscellaneous supplies used in production activities can also be considered a product cost if they are used in the manufacturing process. Therefore, the best choice is B, advertising expense.

Which of the Following Is a Period Cost