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Under Variable Costing, Product Cost Does Not Contain Any Fixed

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Under variable costing, product cost does not contain any fixed manufacturing overhead cost.


Definitions:

Work In Process

Partially finished goods that are in various stages of production but are not yet completed.

Process Cost Systems

Accounting systems used to apply costs to similar products that are mass-produced in a continuous fashion, enabling consistent unit cost calculation.

Similar Products

Goods that satisfy the same customer needs or desires and are often interchangeable in use or consumption.

Activities Performed

The actions or operations carried out by an individual or organization in pursuit of certain objectives.

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