Which of the following is considered part of the product costs under absorption costing but not under variable costing? Group of answer choices Direct materials Selling expenses Variable overhead Fixed manufacturing overhead

Which of the following is considered part of the product costs under absorption costing but not under variable costing? Group of answer choices Direct materials Selling expenses Variable overhead Fixed manufacturing overhead

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Which of the following is considered part of the product costs under absorption costing but not under variable costing?

Group of answer choices

Direct materials

Selling expenses

Variable overhead

Fixed manufacturing overhead

Definition Definition Indirect costs incurred while producing goods or services. Overhead costs cannot be directly attributed to products or services. Overhead includes indirect material cost, indirect labor cost, rent, utilities expenses, and depreciation. Since these costs directly affect the profitability of a company, managing overhead becomes an important task for management.

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