Which Statement Is Correct About Absorption Costing

question 73

Multiple Choice

Which statement is correct about absorption costing?

• A)Under this method, fixed overhead is considered a product cost because production cannot take place without these costs.
• B)Under this method, fixed overhead is considered a period cost because such costs do not vary according to production level.
• C)Under this method, variable overhead is considered a period cost because such costs do not vary according to production level.
• D)Under this method, selling costs are considered a product cost because such costs do not vary according to production level.

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Definitions:

Perceptive Observations

The act of keenly and accurately noting and interpreting subtle details or changes, often critical in understanding context or behaviors in various fields like psychology, sales, and research.

Skillful Questioning

The technique of asking insightful and relevant questions to gather information, clarify understanding, and lead conversations effectively.

Trial Close Question

A sales technique involving a question posed by the salesperson to gauge the prospect’s readiness to buy, often before the final close.

Least Effective

Describes a method or approach that yields the minimal positive outcome or results when compared to other alternatives.