A product cost is deducted from revenue in the period in which:
A)The related finished goods are sold.
B)The expenditure is made.
C)The production of the product begins.
D)The production process is completed.

Question

Quizplus · Accepted Answer

Product cost is recognized as an expense only when the related finished goods are sold because it is only at this point that revenue is generated. The cost is deducted from the revenue to arrive at the gross profit.

A Product Cost Is Deducted from Revenue in the Period