The incremental costs of producing one more unit of product include all of the following EXCEPT:
A)direct materials
B)direct labor
C)variable overhead costs
D)fixed overhead costs

Question

Quizplus · Accepted Answer

The incremental costs of producing one more unit of product only includes direct materials, direct labor, and variable overhead costs. Fixed overhead costs are not included in the incremental costs as they are considered sunk costs and do not change with the production of each additional unit.

The Incremental Costs of Producing One More Unit of Product