Which choice below best describes product cost as defined by generally accepted accounting principles?

All factory costs

Any cost caused by the product (e.g., warranty repairs expense)

Direct and variable factory costs

A cost that goes on the income statement as an expense

Which choice below best describes period cost as defined by generally accepted accounting principles?

A cost for a resource used up outside the factory

All costs incurred by the organization

All non-factory costs

All direct costs, whether fixed or variable

Under full costing (also known as absorption costing or GAAP costing) inventory includes:

All of the above

Direct materials

Direct labor

Manufacturing overhead