Which If the Following Is Not a Component of Determining

question 47

Multiple Choice

Which if the following is not a component of determining and recording manufacturing costs?

• A) Charging direct materials and direct labor to work in process.
• B) Transferring costs between production departments.
• C) Assigning manufacturing overhead to work in process.
• D) Maintaining correctness of inventory balances.
• E) Transferring the cost of completed production to finished goods.

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Definitions:

Contribution Format

A type of income statement layout that separates variable costs from fixed costs, highlighting the contribution margin.

Absorption Costing

A technique in cost accounting that incorporates all costs of production, including fixed and variable, into the valuation of inventory and cost of goods sold.

Variable Costing

An accounting method that includes only variable production costs as product costs, treating fixed manufacturing overhead as an expense of the period in which it is incurred.

Unit Product Cost

The total cost associated with producing a single unit of a product, including direct materials, direct labor, and allocated overhead.