Asked by Anthony Espino on Jul 17, 2024
Verified
Under variable costing, all variable production costs are treated as product costs.
Variable Costing
A costing method that includes only variable production costs - direct materials, direct labor, and variable manufacturing overhead - in the cost of a product.
Variable Production Costs
Costs that fluctuate with the level of output production, such as raw materials and direct labor.
- Establish which costs are considered product costs in the context of variable and absorption costing techniques.
Verified Answer
AC
Alivia CroteauJul 20, 2024
Final Answer :
True
Explanation :
Under variable costing method, only variable production costs are included in product costs. Fixed overhead costs are treated as period costs and are expensed in the period incurred.
Learning Objectives
- Establish which costs are considered product costs in the context of variable and absorption costing techniques.
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