product costs?

Question

what is product costs? give examples of product costs

Answer 1

Products result from the manufacturing process and "product costs" are the summation of direct materials, direct labor, and factory overhead (rent of the factory, utilities of the factory, depreciation of the machine used in the production process, upkeep of the machine, etc). This collection of costs constitutes an asset on the balance sheet ("inventory"). This inventory remains as an asset until the goods are sold, at which point the inventory is gone, and the cost of the inventory is transferred to cost of goods sold on the income statement (to be matched with the revenue from the sale).

On the other hand, period costs are the nonmanufacturing costs that should be expensed within the period incurred. E.g. are the bookkeeper's salary, advertising, rent of office space, etc

Answer 2

For financial accounting reports, a product costs is a cost assigned to goods that were either manufactured or purchased for resale.

For retailers or wholesalers where inventory is acquired, products cost is the cost of purchase plus the cost of transportation of the inventory into the business.

For manufacturer, inventory is manufactured; products costs consists of manufacturing costs (direct material direct labor, manufacturing overhead)

Direct material
Raw material that is
· Consumed in the manufacturing process
· Physically incorporated into the finished product
· Can be traced to a product conveniently

Direct labor
· Cost of wages and labor on-costs of staff who work directly on the manufactured product.
Labor on-costs include the additional costs that are incurred to employ personnel, including payroll tax, worker’s compensation and the employees’ superannuation contributions

Manufacturing overhead
· Indirect manufacturing costs such as depreciation and insurance of manufacturing equipment, utilities such as electricity

Example:
A manufacturer produces cars. The product costs would include direct materials, that is, the raw material such as the parts that will be put together to make the car. Direct labor would include the workers in the factory line and manufacturing overhead could be electricity for the factory equipment. All these costs would sum up to the product cost of the inventory.

Products cost is recorded as part of the asset, inventory, until the goods are sold. When the goods are sold, the products cost is transferred from the inventory account to cost of goods sold, an expense account.

Answer 3

product cost include raw materials and it processing cost which include the cost factories and staff

for example a music CD product cost include fee payed to the artists plus the cost of pressing and packaging and the percentage which goes to RIAA which some time is a lot more then what goes to the artists

Answer 4

buy something a car for $3000.00, you sell it for 3500. what is your product cost? 3000.

in a manufacturing product cost is different? the cost is renting of building, labor, power, and etc.

this is very brief summary, please its just an idea.