Absorption costing measures contribution to operating profit as:
A) Sales less unit level costs spent on goods sold.
B) Sales less variable cost of goods sold.
C) Sales less absorption cost of goods sold.
D) Sales less all costs including operating expenses.

Question

Quizplus · Accepted Answer

Absorption costing measures contribution to operating profit by subtracting the absorption cost of goods sold from sales. This includes both variable and fixed manufacturing costs.

Absorption Costing Measures Contribution to Operating Profit As