2-20 APAPA Limited is analyzing its inventoriable costs and period costs. Which of the following statements is/are correct? I. Inventoriable cost and period costs flow through the income statement at a merchandising company similar to the way costs flow at a manufacturing company. II. Inventoriable costs are considered assets in the balance sheet (or statement of financial position) but period costs are considered operating costs in the income statement. III. Period costs are all costs in the income statement other than cost of goods sold while inventoriable costs are transformed to work-in-process goods and finished goods. 1. I and II only are correct. 2. II and III only are correct. 3. I and III only are correct. 4