Like product costs, period costs are not necessarily treated as expenses in the period in which they are incurred

Question

Quizplus · Accepted Answer

Period costs are treated as expenses in the period in which they are incurred, while product costs are capitalized and treated as expenses when the products are sold or when the assets are disposed of. Examples of product costs include direct materials, direct labor, and manufacturing overhead, while examples of period costs include selling expenses, administrative expenses, and interest expenses.

Like Product Costs, Period Costs Are Not Necessarily Treated as Expenses