?

Free Version

Upgrade subject to access all content

Easy

Varible Costing vs Absorption: Select TRUE Statement

MGRACT-YEZVEA

Which of these is TRUE about variable costing versus absorption costing?

A

Under absorption costing, total product costs consist of direct materials, direct labor, and variable manufacturing overhead.

B

Under absorption costing, non-product costs are added to the cost of inventory produced.

C

The costs assigned to units in inventory are lower or the same under variable costing than under absorption costing.

D

Conversion costs (labor and manufacturing overhead) are considered to be product costs under absorption costing but not variable costing.