Final answer:
Under absorption costing, variable administrative costs, variable selling costs, and fixed selling costs are classified as period costs. These are non-manufacturing expenses not directly tied to the production process. Other listed costs related directly to manufacturing are considered product costs under absorption costing.
Step-by-step explanation:
The student's question relates to determining which costs are classified as period costs under absorption costing. In absorption costing, period costs are all the costs that are not product costs, meaning they are not directly tied to the production process. These costs include sales and administrative expenses, which are not directly related to the manufacturing of the product. Therefore, period costs typically include non-manufacturing costs that are incurred regardless of the production level, such as marketing, sales, and administrative expenses.
Variable administrative costs (B), variable selling costs (E), and fixed selling costs (F) can be classified as period costs under absorption costing because these are expenses that are not incurred as a direct part of the manufacturing process.
On the other hand, variable manufacturing overhead costs (A), direct labor (C), direct materials (D), and fixed manufacturing overhead costs (G) are considered product costs, as they are directly associated with the production of goods and services and are absorbed into the cost of goods sold when a product is manufactured.