A variable costing income statement is the same as a:
A) contribution margin income statement.
B) classified income statement.
C) traditional income statement.
D) departmental income statement.

Question

Quizplus · Accepted Answer

A variable costing income statement focuses only on the variable costs associated with producing goods and services, and therefore calculates a contribution margin for each unit sold. This makes it equivalent to a contribution margin income statement, which also focuses on the contribution margin arising from the sale of products or services, and is used to calculate the breakeven point or target profit level. A classified income statement and a traditional income statement are both different formats of presenting financial information, and do not necessarily use the same approach to calculating costs or revenue. A departmental income statement is a report that breaks down expenses and revenue by department, and may or may not use variable costing.

A Variable Costing Income Statement Is the Same as A