Costs That Flow Directly to the Current Income Statement Are

question 7

Multiple Choice

Costs that flow directly to the current income statement are called:

• A) Period costs.
• B) Product costs.
• C) General costs.
• D) Balance sheet costs.
• E) Capitalized costs.

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Definitions:

Sales Volumes

The quantity of products or services sold by a company within a specific time period.

Contribution Format

A financial statement format that separates fixed and variable costs to highlight the contribution margin.

Net Operating Income

This is the profit a business generates from its operations, excluding non-operating income and expenses, taxes, and interest.

Units

In a manufacturing or production context, units refer to individual items or products.