Lauren's salary decreases from $34,000 to $30,000. She decides to reduce the number of outfits she purchases each year from 20 t

Answer:

C) $88,000

Explanation:

A period cost refers to expenses that cannot be capitalized through inventory or other assets.

Under the variable costing method, fixed costs are classified as period costs.

Fixed costs:

Fixed manufacturing overhead: $60,000

Fixed selling and administrative expense: $28,000

Dec 31              Management Services....................................$1875

                           To Prepaid Expenses.....................................................$1875

(Reflecting the recognition of prepaid expenses for the year)