BUS 254 Chapter Notes - Chapter 2: Income Statement, European Cooperation In Science And Technology, Marginal Cost

• School: Simon Fraser University
• Department: Business Administration
• Course: BUS 254
• Professor: Masood Kamlani

Document Summary

Cost : the sacrifice made, usually measured by resources given up, to achieve a purpose: the meaning of cost (page 29) Product costs, period costs, and expenses (page 29) Expense: the cost incurred when an asset is used up or sold for the purpose of generating revenue. Product and period costs are used to describe the timing with which various expenses are recognized. Service industry firms generally refer to the costs of producing services as operating expenses. Operating expenses are treated as period costs and are expensed during the period they are incurred. Raw material inventory : includes all materials before they are placed into production. Work in process inventory: manufactured products that are only partially completed at the date when the balance sheet is prepared. Finished goods inventory : refers to manufactured goods that are complete and ready for sale: manufacturing operations and costs (page 34)