Period costs are those that are not included in the cost of production of the product and that directly account for current gains and losses, including operating costs (sales costs), management costs and financial costs. Operating expenses (sale costs) are those incurred by the enterprise in the course of the sale of goods, including transportation, handling, packing, insurance, exhibition and advertising expenses incurred by the enterprise in the sale of goods, as well as the wages and benefits of employees of marketing establishments specializing in the sale of the goods of the enterprise (including distribution points, post-sale service outlets, etc.), costs of operating expenses of a similar nature, operating expenses, etc., and expenses incurred by commercial enterprises in the purchase of goods, including those incurred in the purchase of goods. Management costs are those incurred by an enterprise in organizing and managing its production operations, including those incurred by the enterprise's board of directors and administrative management in the management of the enterprise's operations, or by corporate funds that should be borne jointly by the enterprise (including salaries, repairs, material consumption, amortization of low-value expendables, office and travel expenses, etc. For employees in the administration sector), trade union funds, pending insurance, labour insurance, board fees, fees for intermediaries, fees for consultants (including consultants), fees for litigation, business hospitality, property taxes, taxes on the use of vehicles, land use taxes, stamp duties, technology transfer fees, compensation for mineral resources, amortization of intangible assets, education of employees, research and development fees, sewage charges, inventory losses or gains (excluding loss of inventory to be included in off-the-book expenses), preparation for bad accounting and preparation for stock falls. Financial costs are expenses incurred by an enterprise to raise the funds needed to operate its production operations, including interest expenses (less interest income), loss on exchange (less gain on exchange) and related handling fees that should be charged to the period. The classification of costs by economic purpose clearly reflects the cost of materials directly used in the production of products, the wages of workers and the various expenditures spent on the organization and management of productive activities, thus helping enterprises to understand the implementation of cost plans, quotas, budgets, etc., control of cost expenditures and strengthen cost management and cost analysis。
