Product costs:

Those costs that are identified with goods purchased or produced for resale. In manufacturing firm, these costs are attached to the product and included in stock valuation for finished goods or work-in-progress, until they are sold.

Period costs:

Those costs that are identified with a SPECIFIC TIME INTERVAL and not inventoried. They are charged to the period as another form of matching expenses with revenue.

Salient Point:

In a manufacturing concern, all manufacturing costs are regarded as product costs and non-manufacturing costs as period costs.