A manufacturing company prepays its insurance coverage for a three-year period. The premium for the...
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Accounting
A manufacturing company prepays its insurance coverage for a three-year period. The premium for the three years is $3,000 and is paid at the beginning of the first year. Three-fourths of the premium applies to factory operations and one-fourth applies to selling and administrative activities. What amounts should be considered product and period costs respectively for the first year of coverage?
Product Period
A) $1,000 $0
B) $250 $750
C) $2,250 $750
D) $750 $250
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