The costing method that treats all fixed costs as period costs is:
A) absorption costing.
B) job-order costing.
C) variable costing.
D) process costing.

Question

Quizplus · Accepted Answer

Variable costing treats all fixed costs as period costs and only includes direct costs in the cost of goods sold calculation. This method is useful for internal decision-making as it provides a clearer understanding of the cost behavior and contribution margin for each product or service.

The Costing Method That Treats All Fixed Costs as Period