Question

Costs assigned to units of product under absorption costing include:

a) Direct materials and direct labor
b) Variable manufacturing costs
c) Fixed manufacturing costs
d) Both b and c

Answer 1

Costs assigned to units of product under absorption costing include fixed manufacturing costs and variable manufacturing costs.

Step-by-step explanation:

Costs assigned to units of product under absorption costing include:

Costs assigned to units of product under absorption costing include fixed manufacturing costs and variable manufacturing costs.

Fixed manufacturing costs and Variable manufacturing costs Under absorption costing, both fixed manufacturing costs and variable manufacturing costs are assigned to units of product.

Fixed manufacturing costs are costs that do not change regardless of the level of production, such as rent on a factory or retail space. Variable manufacturing costs, on the other hand, vary with the level of production, such as labor and raw materials.