LO 2.2Explain the difference between a period cost and a product cost.

Difference between product cost and period cost is stated as follows:-

Product cost is experience in the business field only if there is production of products but period cost is the cost that is faced by the organization during the passing of time. Product cost has the tendency to vary whereas period cost remains the same or fixed. Product cost is considered as the fragment of inventory but period cost is not not included in that.

Example of product cost are: - labor wages, raw material cost etc

Example of period cost:-rent, salary etc.