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In like manner, a finished goods inventory will also have an inventoriable cost. This will include not only all the costs related to the raw materials, but also the direct labor and any fixed or variable overhead that is incurred while producing those finished goods. If those goods are stored at a rented facility, even the cost of the rental will be accounted for as an inventoriable cost.
Common examples of period costs include marketing expenses, rent, office depreciation and indirect labor. Even if physical inventories are composed of items that are treated as product costs, the actual administration of warehouses and inventory management expenses are considered period costs. RELATED FAQS.