For Each of the Following, Indicate Whether the Cost Would

question 23

Multiple Choice

For each of the following, indicate whether the cost would typically be considered a product or period cost for the cost object given.
-Salary of plant manager

• A)Product
• B)Period

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Definitions:

Obsolescence

The process of becoming outdated or no longer used, often as a result of new inventions, technologies, or changes in consumer preference.

Cash Payback Period

The length of time it takes for an investment to generate enough cash flow to recover the initial investment cost.

Net Cash Flow

The difference between a company's cash inflows and outflows within a specified period, representing the overall change in its cash position.

Average Rate of Return

A financial ratio that compares the average annual profit of an investment to its initial cost, often used to assess the profitability of an investment over time.