For a manufacturing firm, which of the following is a period cost?
A)Office rent
B)Wages of factory janitor
C)Insurance cost of production equipment
D)Raw materials

Question

Quizplus · Accepted Answer

Office rent is a period cost because it is a cost that occurs over a specific period of time and is not directly related to the production process. Wages of factory janitor and insurance cost of production equipment are both examples of manufacturing overhead, which are indirect costs that are incurred during the production process. Raw materials are direct costs that are directly related to the production process.

For a Manufacturing Firm, Which of the Following Is a Period