How Are Fixed Manufacturing Costs Handled Under Variable Costing

question 12

Multiple Choice

How are fixed manufacturing costs handled under variable costing?

• A)They are subtracted from the variable cost of goods sold to determine the ending inventory value that will be recorded on the Balance Sheet.
• B)They are not recorded, which is why variable costing is not used for external reporting.
• C)They are recorded directly on the Balance Sheet.
• D)They are treated as period costs.

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