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The salary of a plant manager should be classified as which type of cost?

A. a period cost but not a product cost
B. a product cost but not a period cost
C. both a product and a period cost
D. neither a product cost nor a period cost

User Tsorn
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1 Answer

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Final answer:

The salary of a plant manager is classified as a period cost but not as a product cost because it is not directly associated with the production of goods.

Step-by-step explanation:

The salary of a plant manager is typically classified as a period cost but not a product cost. In managerial accounting, period costs are those costs that are not directly tied to the production process and are expensed in the accounting period in which they are incurred.

Examples of period costs include selling, general and administrative expenses. A plant manager's salary is not incorporated into the cost of producing goods, hence it is considered a period cost. Product costs, on the other hand, are those costs that are directly associated with the creation of a product, such as raw materials, labor, and manufacturing overhead.

User Kwz
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