Which of the following statements about product costs is true?
A) Product costs are deducted from revenue when the production process is completed.
B) Product costs are deducted from revenue as expenditures are made.
C) Product costs associated with unsold finished goods and work in process appear on the balance sheet as assets.
D) Product costs appear on financial statements only when products are sold.

Question

Quizplus · Accepted Answer

Product costs associated with unsold finished goods and work in process appear on the balance sheet as assets. This is because product costs are considered a part of inventory until the products are sold, at which point they are expensed as Cost of Goods Sold.

Which of the Following Statements About Product Costs Is True