The costing method, in which the variable manufacturing costs are treated as inventoriable cost is called ___________?
Correct answer: A. variable costing
- A. variable costing
- B. absorption costing
- C. manufacturing costing
- D. labor costing
Explanation
Variable costing treats variable manufacturing costs as inventoriable and charges fixed manufacturing overhead to the period. Absorption costing, by contrast, inventoriably includes both variable and fixed manufacturing costs.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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