Which of the following best describes costs assigned to the product under the absorption costing method?
Direct labor (DL)
Direct materials (DM)
Variable selling and administrative
Variable manufacturing overhead
Fixed selling and administrative
Fixed manufacturing overhead
a.DL, DM, variable selling and administrative costs, and variable manufacturing overhead.
b.DL, DM, and variable manufacturing overhead.
c.DL, DM, variable manufacturing overhead, and fixed manufacturing overhead.
d.DL and DM.
e.DL, DM, fixed selling and administrative, and fixed manufacturing overhead.

Question

19-12-2022
Business

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Which of the following best describes costs assigned to the product under the absorption costing method?
Direct labor (DL)
Direct materials (DM)
Variable selling and administrative
Variable manufacturing overhead
Fixed selling and administrative
Fixed manufacturing overhead
a.DL, DM, variable selling and administrative costs, and variable manufacturing overhead.
b.DL, DM, and variable manufacturing overhead.
c.DL, DM, variable manufacturing overhead, and fixed manufacturing overhead.
d.DL and DM.
e.DL, DM, fixed selling and administrative, and fixed manufacturing overhead.

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Tutorconsortium435 Tutorconsortium435 · Answer 1 · 2022-12-22T07:39:41+01:00

DL, DM, variable manufacturing overhead, and fixed manufacturing overhead are all possible options. According to the absorption costing approach, the cost of production includes the direct costs of the materials and labor utilised.

What are the three strategies of costing?

The main costing methods that are available are process costing, job costing, direct costing, and throughput costing. Any of these methods can be applied in different production and decision-making circumstances.

What are the two primary costing techniques?

The two fundamental techniques for costing are job costing and process costing. Job costing is appropriate for industries that produce goods or carry out work in accordance with client standards. Industries with continuous manufacturing and standardized units produced can benefit from process costing.

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