Costs that are treated as assets until the product is sold are
A) product costs
B) period costs
C) conversion costs
D) selling expenses

Question

Quizplus · Accepted Answer

Costs that are treated as assets until the product is sold are known as product costs. These costs are incurred in the manufacturing or purchase of a product and include direct materials, direct labor, and manufacturing overhead. They are capitalized as an asset on the balance sheet until the product is sold, at which point they are expensed as cost of goods sold.

Costs That Are Treated as Assets Until the Product Is