Which of the following costs would be classified as product costs? Travel expens

Question

Which of the following costs would be classified as product costs?

Travel expenses to send sales personnel to conferences and utilities costs.

Indirect labor and indirect materials.

Rental costs of administrative offices and indirect materials.

Property taxes on the factory building and public relations costs.

Travel expenses to send sales personnel to conferences and utilities costs.

Indirect labor and indirect materials.

Rental costs of administrative offices and indirect materials.

Property taxes on the factory building and public relations costs.

Explanation / Answer

Indirect labor and indirect materials.

Product costs includes direct materials, direct labor and Manufacturing / Factory overhead.

Manufacturing / Factory overhead includes indirect materials and indirect labor. Hence Indirect materials and indirect labor should be classified as product costs

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