(Product and period costs) Phylo Company incurred the following costs in August 1997:

* Paid a 6-month premium for insurance of company headquarters, $12,000.

■ Paid 3 months of property taxes on its factory building, $7,500.

* Paid a $40,000 bonus to the company president.

■ Accrued $10,000 of utility costs, of which 30 percent was for the headquarters and the remainder for the factory.

a. What expired period cost is associated with the August information?

b. What unexpired period cost is associated with the August information?

c. What product cost is associated with the August information?

d. Discuss why the product cost cannot he described specifically as expired or unexpired in this situation.

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