Only direct materials, direct labor, and variable manufacturing overhead costs are considered product costs when using
A) full costing.
B) absorption costing.
C) variable costing.
D) product costing.

Question

Quizplus · Accepted Answer

Only direct materials, direct labor, and variable manufacturing overhead costs are considered product costs when using variable costing. This is because variable costing only includes costs that vary with changes in production levels. Full costing and absorption costing include fixed manufacturing overhead costs as product costs, while product costing is not a specific costing method.

Only Direct Materials, Direct Labor, and Variable Manufacturing Overhead Costs