Product cost for financial statement purposes may include:
A)all costs allowed by government agencies
B)all costs included for pricing and product-mix decisions
C)production costs
D)all costs except marketing costs

Question

Quizplus · Accepted Answer

For financial statement purposes, product cost typically includes only the production costs of the product, such as direct materials, direct labor, and factory overhead costs. It does not include marketing or selling costs, which are typically considered period expenses and expensed immediately on the income statement. Options A and B are not accurate as they do not reflect the true cost of producing a product.

Product Cost for Financial Statement Purposes May Include