Raw Materials

The three basic components of inventoriable product costs are direct materials, direct labor and

manufacturing overhead

cost of goods manufactured

work in process

cost of goods sold

The cost of goods manufactured

Is recorded as a increase to the Finished Goods Inventory account.

Is also referred to as the cost of goods sold.

Is recorded as an increase to the Cash or Accounts Receivable account.

Is always the same as the total direct costs.

Period costs include which of the following expenses?

hurricane insurance for the factory

advertising

electricity used in manufacturing

direct labor

Which of the following is not classified as an overhead cost

Insurance to protect the factory contents

Security guards that protect the factory building

Advertising cost to promote the finished goods

Electricity to run factory machines