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The primary difference between absorption and variable costing is that variable costing treats a. Only direct materials and direct labor as product cost. b. Direct materials, direct labor, the variable portion of manufacturing overhead, and an allocated portion of fixed manufacturing overhead as product costs. c. Only direct materials, direct labor, the variable portion of selling and administrative expenses as product cost. d. Only direct materials, direct labor, and the variable portion of manufacturing overhead as product costs.

The primary difference between absorption and variable costing is that variable costing treats a. Only direct materials and direct labor as product cost. b. Direct materials, direct labor, the variable portion of manufacturing overhead, and an allocated portion of fixed manufacturing overhead as product costs. c. Only direct materials, direct labor, the variable portion of selling and administrative expenses as product cost. d. Only direct materials, direct labor, and the variable portion of manufacturing overhead as product costs.

Principles of Accounting Volume 2
Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter6: Activity-based, Variable, And Absorption Costing
Section: Chapter Questions
Problem 17MC: Under absorption costing, a unit of product includes which costs? A. direct material, direct labor,...
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The primary difference between absorption and variable costing is that variable costing treats a. Only direct materials and direct labor as product cost. b. Direct materials, direct labor, the variable portion of manufacturing overhead, and an allocated portion of fixed manufacturing overhead as product costs. c. Only direct materials, direct labor, the variable portion of selling and administrative expenses as product cost. d. Only direct materials, direct labor, and the variable portion of manufacturing overhead as product costs.
Transcribed Image Text:The primary difference between absorption and variable costing is that variable costing treats a. Only direct materials and direct labor as product cost. b. Direct materials, direct labor, the variable portion of manufacturing overhead, and an allocated portion of fixed manufacturing overhead as product costs. c. Only direct materials, direct labor, the variable portion of selling and administrative expenses as product cost. d. Only direct materials, direct labor, and the variable portion of manufacturing overhead as product costs.
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