Definitions Flashcards

1
Q

Product Cost

A

Cost added to the cost price of a unit
of inventory

(included in cost of sales)

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2
Q

Period Cost

A

Absence of a logical basis to allocate costs would mean that a cost cannot be treated as a product cost (because it is not specific to the item itself) and therefore must he treated as a period cost.

Cost written off as an expense for the reporting period.

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