Which of the following is not true of the direct costing procedure?
A)Variable selling expenses are deducted from the manufacturing margin.
B)The cost of goods sold, based solely on variable costs, is subtracted from net sales to arrive at the manufacturing margin.
C)Variable and fixed costs are considered part of the cost of goods manufactured.
D)Variable administrative expenses are deducted from the manufacturing margin.

Question

Quizplus · Accepted Answer

Direct costing considers only variable costs as part of the cost of goods sold and excludes fixed costs. Therefore, fixed costs are not included in the cost of goods manufactured in the direct costing procedure.

Which of the Following Is Not True of the Direct