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Brooke Galletti
on Dec 01, 2024

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Under variable costing,fixed manufacturing overhead is expensed at the time the units are produced.Under absorption costing,fixed manufacturing overhead is expensed at the time the units are sold.

Variable Costing

An accounting method that includes only variable production costs in product cost, excluding fixed manufacturing overhead.

Absorption Costing

An accounting method where all of the costs associated with manufacturing a product are absorbed by the units produced.

Fixed Manufacturing Overhead

Indirect production costs that remain constant regardless of the level of production, such as rent and salaries of managers.

  • Grasp the key differences in concepts between absorption costing and variable costing.
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Celly GradieDec 03, 2024
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