When are inventoried unit costs expensed?
A)Unit costs are never expensed.
B)Expensed before units are sold.
C)Not expensed until the units are sold.
D)Expensed when they are in production.
E)These costs are period costs not unit costs.

Question

Quizplus · Accepted Answer

Inventoried unit costs, also known as product costs, are not expensed until the units are sold. This is because these costs are directly tied to the production of the product, and are therefore considered assets until the product is sold. Once the product is sold, the costs are expensed as Cost of Goods Sold on the income statement.

When Are Inventoried Unit Costs Expensed