Because there are no inventoriable costs for service sector companies,all costs in the income statement are period costs.

Question

Quizplus · Accepted Answer

Inventoriable costs refer to the direct costs associated with producing a product or providing a service, such as raw materials, direct labor, and manufacturing overhead. Since service sector companies do not produce physical goods, they do not have any inventoriable costs. Therefore, all costs in the income statement for service sector companies are classified as period costs.

Because There Are No Inventoriable Costs for Service Sector Companies,all