Cost Accounting, Student Value Edition Plus MyAccountingLab with Pearson eText -- Access Card Package (15th Edition)
15th Edition
ISBN: 9780133781106
Author: Charles T. Horngren, Srikant M. Datar, Madhav V. Rajan
Publisher: PEARSON
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Textbook Question
Chapter 9, Problem 9.4Q
Explain the main conceptual issue under variable costing and absorption costing regarding the timing for the release of fixed manufacturing
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Students have asked these similar questions
Under variable costing, which of the following are costs that can be inventoried
Select one:
O
O
a. variable manufacturing overhead
b. fixed selling and administrative expense
c. variable selling and administrative expense
d. fixed manufacturing overhead
What is a key difference between variable costing and absorption costing?
a.
The usage of homogenous cost pools.
b.
The classification of fixed factory overhead.
c.
classification of direct materials and labor.
d.
The choice of allocation base.
Please indicate which are product costs and which are period costs.
Under Absorption Costing:
Direct Materials are considered a
Direct Labor is considered a
Variable overhead is considered a
Fixed overhead is considered a
Under Variable Costing:
Direct Materials are considered a
Direct Labor is considered a
Variable overhead is considered a
Fixed overhead is considered a
Chapter 9 Solutions
Cost Accounting, Student Value Edition Plus MyAccountingLab with Pearson eText -- Access Card Package (15th Edition)
Ch. 9 - Differences in operating income between variable...Ch. 9 - Why is the term direct costing a misnomer?Ch. 9 - Do companies in either the service sector or the...Ch. 9 - Explain the main conceptual issue under variable...Ch. 9 - Companies that make no variable-cost/fixed-cost...Ch. 9 - The main trouble with variable costing is that it...Ch. 9 - Give an example of how, under absorption costing,...Ch. 9 - What are the factors that affect the breakeven...Ch. 9 - Critics of absorption costing have increasingly...Ch. 9 - What are two ways of reducing the negative aspects...
Ch. 9 - Prob. 9.11QCh. 9 - Describe the downward demand spiral and its...Ch. 9 - Will the financial statements of a company always...Ch. 9 - Prob. 9.14QCh. 9 - The difference between practical capacity and...Ch. 9 - Prob. 9.16ECh. 9 - Prob. 9.17ECh. 9 - Prob. 9.18ECh. 9 - Prob. 9.19ECh. 9 - Prob. 9.20ECh. 9 - Prob. 9.21ECh. 9 - Prob. 9.22ECh. 9 - Prob. 9.23ECh. 9 - Capacity management, denominator-level capacity...Ch. 9 - Prob. 9.25ECh. 9 - Prob. 9.26ECh. 9 - Prob. 9.27ECh. 9 - Prob. 9.28PCh. 9 - Prob. 9.29PCh. 9 - Prob. 9.30PCh. 9 - Prob. 9.31PCh. 9 - Motivational considerations in denominator-level...Ch. 9 - Prob. 9.33PCh. 9 - Prob. 9.34PCh. 9 - Prob. 9.35PCh. 9 - Prob. 9.36PCh. 9 - Prob. 9.37PCh. 9 - Prob. 9.38PCh. 9 - Prob. 9.39PCh. 9 - Prob. 9.40PCh. 9 - Prob. 9.41PCh. 9 - Prob. 9.42P
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- Under variable costing, a unit of product includes which costs? direct material, direct labor, and manufacturing overhead Direct material, direct labor, and variable manufacturing overhead Direct material, direct labor, and fixed manufacturing overhead D. Direct material, direct labor, and all variable manufacturing overheadarrow_forwardUnder absorption costing, a unit of product includes which costs? A. direct material, direct labor, and manufacturing overhead B. direct material, direct labor, and variable manufacturing overhead C. direct material, direct labor, and fixed manufacturing overhead D. direct material, direct labor, and all variable manufacturing overheadarrow_forwardWhich is not a step in analyzing the cost driver for manufacturing overhead? A. Identify the cost B. identify non-value-added costs C. analyze the effect on manufacturing overhead D. identify the correlation between the potential driver and manufacturing overheadarrow_forward
- What are the distinguishing characteristics of variable, fixed, and semivariable factory overhead costs?arrow_forwardHow is the primary focus of activity-based costing different from that of traditional allocation?arrow_forwardCan a company gather information for both variable and absorption costing systems?arrow_forward
- In the variable costing income statement, how are the fixed manufacturing costs reported, and how are the fixed selling and administrative expenses reported?arrow_forwardWhich is not a task typically associated with ABC systems? A. calculating the overhead application rate for each cost pool B. applying a single cost rate C. identifying a cost driver D. more correctly allocating overhead costsarrow_forwardWhat types of costs are customarily included in the cost of manufactured products under (A) the absorption costing concept and (B) the variable costing concept?arrow_forward
- How does absorption costing differ from variable costing? When will absorption-costing operating income exceed variable-costing operating income?arrow_forwardWhy are labor and manufacturing overhead grouped together as conversion costs?arrow_forwardDescribe the product life cycle. How do unit-level costs behave in relation to the product life cycle? Batch-level costs? Product-level costs? Facility-level costs?arrow_forward
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