Respuesta :
Could be a product cost or a period cost depending on the use of the asset
Answer:
The correct answer is letter "A": Could be a product cost or a period cost depending on the use of the asset.
Explanation:
Product costs are those incurred for the manufacturing process. Direct material, direct labor, and overhead are considered product costs. Period costs are costs not involved directly in the manufacturing process but necessary for the operations of the company. Management wages are considered period costs.
When it comes to depreciation, the depreciation of production equipment is considered a product cost while the depreciation of the warehouse where the inventory is stoked represents a period cost.
