Which of the following statements is TRUE regarding period costs? They become CO

Question

Which of the following statements is TRUE regarding period costs? They become COGS once product is sold. They include all costs associated with manufacturing product. They include the cost of advertising and corporate officer salaries They attach themselves to each item of product and move through the accounting system as such. Question 9 1 pts Based on the standard set by Tish Company, 5500 direct labor hours should have been used in production this period at a cost of $20 per hour. The actual results indicate that 5,400 hours were used at a total cost of $113,400. What is the direct labor price variance? 3,400 U 5,400U 3,400 F 5,400 F

Explanation / Answer

Answer to 8 is C

Product cost are those which are not product cost i.e. we can say it is admin and selling expenses therefore all other statements are invalid except that They include advertising and corporate officers salaries.

Answer to 9 is $5400 U

Direct Labor Rate Variance = (Standard Rate - Actual Rate) x Actual Hours                                                        = [20 - 21] x 5400                                                              = 5400 Unfav

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