If fixed production costs are not allocated to manufactured products,this conveys the idea that ________.
A) fixed costs are not necessary to manufacture a product.
B) fixed costs are necessary to manufacture a product.
C) variable costs are less important than fixed costs to manufacture a product.
D) fixed costs are more important than variable costs to manufacture a product.

Question

Quizplus · Accepted Answer

If fixed production costs are not allocated to manufactured products, it implies that the production process can still be carried out without incurring these fixed costs. This does not mean that fixed costs are not necessary to manufacture a product, but only that they are not allocated to individual products.

If Fixed Production Costs Are Not Allocated to Manufactured Products,this