Absorption costing classifies costs as either product costs or
A) period costs.
B) fixed costs.
C) prime costs.
D) conversion costs.

Question

Quizplus · Accepted Answer

Absorption costing distinguishes costs as either product costs or period costs. Period costs are not associated with the production of goods, whereas product costs are. Therefore, the correct answer is A - period costs. The other options, fixed costs, prime costs, and conversion costs, are not relevant to this distinction.

Absorption Costing Classifies Costs as Either Product Costs or