Which of the following types of costs is a product cost for absorption costing but a period cost for variable costing?

Question

Quizplus · Accepted Answer

Fixed factory overhead per unit sold is considered a product cost under absorption costing because it is included in the cost of each unit produced. However, under variable costing, it is considered a period cost because it is not included in the cost of each unit produced but is instead expensed in the period incurred.

The other options are not correct because:
A) Direct materials are always considered a product cost for both absorption and variable costing.
B) Direct labor is always considered a product cost for both absorption and variable costing.
D) Variable selling expense is always considered a period cost for both absorption and variable costing.
E) Total administrative expense is always considered a period cost for both absorption and variable costing.

Which of the Following Types of Costs Is a Product