The Costing Method in Which Only Variable Product Costs Are

question 38

Multiple Choice

The costing method in which only variable product costs are accumulated in inventory is called

• A)Absorption costing
• B)Normal costing
• C)Direct costing
• D)Full costing

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Definitions:

Marginal Cost

The price of making one more unit of a product or service.

Average Product

The output per unit of input, such as labor or machinery, typically used in the context of analyzing production efficiency.

Marginal Cost

The increase in total cost that results from producing one additional unit of a good or service.

Total Cost

The total economic cost of production, including both fixed and variable costs.