Direct labor and direct materials are a. product costs and expensed when incurred b. period costs and expensed when the goods are sold c. period costs and expensed when incurred d. product costs and expensed when the goods are sold

The correct answer is letter "D": product costs and expensed when the goods are sold.

Explanation:

Product costs are the ones related to the process of production. They can refer to costs in direct labor, direct material, production supplies, and factory overhead. Product costs are also called the unit cost of the product and are determined by dividing all costs incurred by the number of units produced in a plant. Product costs are expensed when they are sold following the accrual method of accounting.

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