Economic essence, content and classification of period costs in enterprises

Abstract

This article investigates the economic essence, content and accounting role of period costs from a theoretical and methodological perspective. The study analyzes the conceptual basis for distinguishing period costs from costs included in production cost, their mechanism of influence on financial performance, and the advantages and limitations of existing classification approaches. It is substantiated that the classification of period costs solely according to their functional nature into selling, administrative and other operating expenses does not provide sufficient information for effective managerial decision-making. Consequently, a multi-criteria classification model of period costs is proposed based on functional purpose, economic content, cost behavior, management level, responsibility centers and strategic significance. The proposed approach contributes to more accurate identification, control and evaluation of the impact of period costs on an enterprise's financial performance.