A New Employee in the Accounting Department Is Having Difficulty

question 187

Essay

A new employee in the accounting department is having difficulty understanding two sets of accounting terms-variable and fixed costs as opposed to period and product costs.He understands that variable costs change during an accounting period while fixed costs do not.However, he explains that a period cost implies that it is for a period of time and is, therefore, also fixed.Does his assumption imply that all product costs are then variable?
Required:
As part of your responsibility to train new staff, explain the difference between these terms.

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Definitions:

Dopamine Antagonists

Drugs that block dopamine receptors, often used to treat psychiatric disorders such as schizophrenia and bipolar disorder.

Schizophrenia

A complex mental disorder characterized by disruptions in thought processes, perceptions, emotional responsiveness, and social interactions.

Nigrostriatal Dopamine Pathway

A neural pathway in the brain that plays a major role in movement control.

Mesolimbic

Refers to a pathway in the brain involved in reward, pleasure, and reinforcement learning, part of the dopamine system.