What Factor,related to Manufacturing Costs,causes the Difference in Net Earnings

question 59

Multiple Choice

What factor,related to manufacturing costs,causes the difference in net earnings computed using absorption costing and net earnings computed using variable costing?

• A)Absorption costing considers all costs in the determination of net earnings,whereas variable costing considers fixed costs to be period costs.
• B)Absorption costing allocates fixed overhead costs between cost of goods sold and inventories,and variable costing considers all fixed costs to be period costs.
• C)Absorption costing "inventories" all direct costs,but variable costing considers direct costs to be period costs.
• D)Absorption costing "inventories" all fixed costs for the period in ending finished goods inventory,but variable costing expenses all fixed costs.

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Definitions:

Apical Meristems

Regions at the tips of plant roots and shoots where cells actively divide, leading to growth.

Lateral Meristems

Plant tissue responsible for growth in thickness or girth in a maturing plant, located in stems and roots.

Primary Growth

Of plants, lengthening of young shoots and roots; originates at apical meristems.

Secondary Growth

Of plants, thickening of older stems and roots; originates at lateral meristems.