Use the information below to answer the following question(s).
Frazer Inc. had the following activities in the year:

-Which of the following is true of period costs?
A) They are also called fixed costs.
B) They are part of the cost of goods sold.
C) They are expected to benefit future periods.
D) They are costs incurred to generate revenue in a specific time period except the cost of manufacturing accumulated as cost of goods sold.
E) For merchandising sector companies they include all costs not related to the cost of goods purchased for resale.

Question

Use the information below to answer the following question(s).
Frazer Inc. had the following activities in the year:
 
-Which of the following is true of period costs?
A) They are also called fixed costs. 
B) They are part of the cost of goods sold. 
C) They are expected to benefit future periods. 
D) They are costs incurred to generate revenue in a specific time period except the cost of manufacturing accumulated as cost of goods sold. 
E) For merchandising sector companies they include all costs not related to the cost of goods purchased for resale.

Quizplus · Accepted Answer

Period costs are costs that are incurred to generate revenue in a specific time period, except for the cost of manufacturing accumulated as cost of goods sold. They are not fixed costs and are not part of the cost of goods sold. They are not expected to benefit future periods. For merchandising sector companies, they include all costs not related to the cost of goods purchased for resale.

Use the Information Below to Answer the Following Question(s)