Question

Calculate the total Product costs and Period costs Given that (amount in EGP) : Direct manufacturing labor 15,000 - Mach...


Calculate the total Product costs and Period costs Given that (amount in EGP) : Direct manufacturing labor 15,000 - Machine maintenance 2000 - Sales commission 2000 - Depreciation office equipment 3000 - Depreciation plant equipment 5000 - Advertising expense 1500 - Indirect manufacturing material 2500 - Freight in 2500 - Machinery power 2000 - Direct material used 20.000 Accountant salaries 4000 - Office building rent 3000 Salesmen salaries 5500 -Freight out 1000- Indirect manufacturing labor 1000.

Answer

Product Costs: Product Costs mean the direct costs incurred for the production of a product. Product costs include:

  • Direct material
  • Direct labor
  • Direct Manufacturing overhead
  • Manufacturing supplies etc.

Period costs: Period costs are not directly related to the production process of a product. Sales, general, and administrative costs are considered period costs. 

  Product costs  Period costs
Direct manufacturing labor 15,000  
Machine maintenance 2,000  
Sales commission   2,000
Depreciation office equipment   3,000
Depreciation plant equipment 5,000  
Advertising expense   1,500
Indirect manufacturing material  2,500  
Freight in 2,500  
Machinery power 2,000  
Direct material used 20,000  
Accountant salaries   4,000
Office building rent    3,000
Salesmen salaries    5,500
Freight out   1,000
Indirect manufacturing labor  1,000  
Total 50,000 20,000
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