Product costs are expensed:
A)when the products are consumed or sold.
B)at the end of the accounting period they are incurred in.
C)when the products are transferred to Work-in-Process Inventory account.
D)when the market value of products goes above the recorded value.

Question

Quizplus · Accepted Answer

Product costs are expensed when the products are consumed or sold, as this is when the cost of producing the product is realized as an expense. This is in accordance with the matching principle in accounting, which requires that expenses be recognized in the same period as the related revenue.

Product Costs Are Expensed