Which of the Following Costs Is a Period Cost

question 35

Multiple Choice

Which of the following costs is a period cost?

• A)depreciation of factory equipment
• B)transportation-in for material shipments
• C)amortization of a patent for the company's product
• D)depreciation of office computers

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Definitions:

Franchise Agreement

A legal document outlining the rights and responsibilities of the franchisor and franchisee, including terms of payment, support, and operation.

Terminate the Contract

The act of legally ending an agreement or contract before its predetermined end date.

One-Time Fee

A charge that is paid only once for a service or product, rather than recurring payments.

Franchise Fee

The upfront payment a franchisee makes to a franchisor for the rights to use the franchisor's brand, system, and ongoing support.