Steuben Company produces dog houses. During the current year, Steuben Company incurred the following costs:

Rent on manufacturing facility	$	118,000
Office manager's salary		67,000
Wages of factory machine operators		47,000
Depreciation on manufacturing equipment		17,000
Insurance and taxes on selling and administrative offices		7,000
Direct materials purchased and used		77,000

Based on the above information, the amount of period costs shown on Steuben's income statement is:

I know the answer is $74,000 but can anybody explain why?