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Blue Corporation incurred the following costs while manufacturing its product: Materials used in product $100,000 Advertising Expense $50,000 Depreciation on plant $75,000 Property taxes on

Blue Corporation incurred the following costs while manufacturing its product:

Materials used in product $100,000

Advertising Expense $50,000

Depreciation on plant $75,000

Property taxes on plant $15,000

Property taxes on store $7,500

Delivery Expense $20,000

Labor costs of assembly line workers $125,000

Sales Commissions $40,000

Factory supplies used $13,500

Salaries to sales clerk $50,000

Instructions:

Identify each of the above costs as direct materials, direct labor, manufacturing overhead, or period costs.

Explain the basic difference in accounting for product costs and period costs.

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