The absorption costing approach applies fixed overhead costs to products as though they have a ________ pattern.
A) mixed cost behavior
B) variable cost behavior
C) step cost behavior
D) fixed cost behavior

Question

Quizplus · Accepted Answer

The absorption costing approach treats fixed overhead costs as if they vary with the level of production, similar to variable costs, by allocating these costs to individual units produced. This makes it appear as though the fixed costs change with production volume, hence the "variable cost behavior" description.

The Absorption Costing Approach Applies Fixed Overhead Costs to Products