Costs that are treated as assets until the product is sold are called:

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Product costs are costs that are associated with the production of goods or services and they include both direct and indirect costs. Direct costs are expenses that can be specifically traced to the production of a product or service, such as raw materials, while indirect costs are expenses that cannot be specifically traced to the production process, such as rent, utilities, and salaries of supervisors. Typically, product costs are treated as assets on the balance sheet until the product is sold, at which point they are recognized as expenses on the income statement.

Costs That Are Treated as Assets Until the Product Is