In throughput costing which of the following is untrue?
A) The throughput of a product is its selling price minus its totally variable costs
B) Investment is also called inventory
C) Profit is defined as throughput less operating expenses
D) Operating expenses are classified and thought of as direct costs

Question

Quizplus · Accepted Answer

Operating expenses in throughput costing are not classified as direct costs. Instead, they are considered as fixed costs that do not vary directly with the volume of production or sales. Throughput costing primarily focuses on the contribution of direct material costs to production, treating other manufacturing costs as period expenses.

In Throughput Costing Which of the Following Is Untrue