Match the appropriate costing method to the description (8 points)

a.	Absorption costing only
b.	Variable costing only
c.	Both absorption and variable costing

1. Treats fixed selling cost as a period cost.

2. Required by generally accepted accounting principles.

3. Treats fixed manufacturing cost as a period cost.

D

4. Operating income is impacted by changes in inventory level.

5. Generally provides the most useful report for controlling costs.

6. Generally provides the most useful report for setting long-term prices.

7. May be used in a manufacturing company.

8. Includes gross profit on the income statement