Question

Jensen Company reports the following:

Direct materials used $345,000
Direct labor incurred 250,000
Factory overhead incurred 400,000
Operating expenses 175,000
Jensen Company’s period costs are
a. $345,000
b. $250,000
c. $400,000
d. $175,000

Answer 1

d. $175,000

Step-by-step explanation:

The computation of the period cost is shown below:

Period costs = Operating expenses

= $175,000

It records only that expenses which are incurred during the particular year. Examples - Salaries expense, Depreciation, Repairs, and maintenance, Advertising expense, sales commission, etc

All other information which is given is not relevant. Hence, ignored it