Which of the Following Is Not Included in Absorption Costing

question 54

Multiple Choice

Which of the following is not included in absorption costing?

• A) Fixed overhead
• B) Direct materials
• C) Direct labor
• D) Contribution margin

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Definitions:

Contracts

Legal agreements between two or more parties that are enforceable by law, outlining responsibilities, duties, and sharing of benefits.

IRR

Internal Rate of Return; the discount rate that makes the net present value of all cash flows from a particular project zero.

Cash Flow

The net amount of cash and cash-equivalents being transferred into and out of a business.

Project

A temporary endeavor undertaken to create a unique product, service, or result with specific objectives and defined beginning and end.