or manufacturedfor resale.Period CostsCosts that areidentified withthe period in
which they are
The Meaning of “Cost”?
The sacrifice made,usually measured bythe resources given up,to achieve a particularpurpose.
There are 3 major categories of manufacturingcosts:
Direct Materialsresources that can befeasibly observed beingused to make a specificproduct.Direct LaborThe cost of payingemployees whoconvert direct materialsinto finished product.ManufacturingOverhead
Indirect materialIndirect laborOther overhead
Prime Costs include:
Direct MaterialsDirect Labor ManufacturingOverhead