Question

Which one of the following is an example of a period cost?

a) A manager's salary for work that is done in the corporate head office.
b) Workers' compensation insurance on factory workers' wages allocated to the factory.
c) A change in benefits for the union workers who work in the New York plant of a Fortune 1000 manufacturer.
d) A box cost associated with computers.

Answer 1

The example of a period cost is a manager's salary for work that is done in the corporate head office.

Step-by-step explanation:

A period cost is a cost that is not directly associated with the production of goods or services. It includes expenses that are incurred in a particular period of time and cannot be traced back to a specific product or service. Based on the given options, the example of a period cost is option a) A manager's salary for work that is done in the corporate head office. This cost is not directly related to the production process and is incurred regardless of the level of production or sales. It is considered a period cost because it is associated with a specific period of time, usually a month or a year.