Which of the Following Is TRUE of Period Costs

question 54

Multiple Choice

Which of the following is TRUE of period costs?

• A)They are also called fixed costs.
• B)They are part of the cost of goods sold.
• C)They are expected to benefit future periods.
• D)They are costs incurred to generate revenue in a specific time period except the cost of manufacturing accumulated as cost of goods sold.
• E)For merchandising sector companies they include all costs not related to the cost of goods purchased for resale.

Recognize and utilize specific and clear language in business writing.

Distinguish between connotative and denotative meanings of words.

Identify and avoid ethnically and racially biased language.

Apply strategies to maintain and protect goodwill in communication.

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Definitions:

Effective Capacity

The maximum output level that an organization can sustain under normal conditions, considering the limitations of time, resources, and constraints.

Process Time

The duration elapsed from the start to the finish of a process or operation, often scrutinized for efficiency improvements.

Bottleneck

The limiting factor or constraint in a system.