Businesses incur various costs in selling goods and services. Each business mu

Businesses incur various costs in selling goods and services. Each business must decide which costs are expenses of the period and which should be included in
the cost of the inventory. The following table lists various types of businesses along with certain types of costs they incur:

Accounting Treatment

Business Types of Costs Expense of the Period Inventory Cost Other Treatment

Retail shoe store Shoes for sale

Shoe boxes

Advertising signs

Grocery store Canned goods on shelves

Produce

Cleaning supplies

Cash registers

Frame shop Wooden frame supplies

Nails

Glass

Walk-in print shop Paper

Copy machines

Toner cartridges

Restaurant Frozen food

China and silverware

Prepared food

Spices

Required:

Fill in the table to indicate the correct accounting for each type of cost by placing an X in the appropriate column. For any costs
that receive other treatment explain what the appropriate treatment is for accounting purposes.