Question
Which one of the following statements is incorrect? A. Becasue indirect manufacturing costs are not traceable to individual products, they are treated as period costs.
Which one of the following statements is incorrect?
A. | Becasue indirect manufacturing costs are not traceable to individual products, they are treated as period costs. | |
B. | Contribution margin does not help much a manager who is about to take a long-term decision. | |
C. | Under absorption costing, the value of a unit includes all product costs. | |
D. | GAAP recommends the use of absorption costing for inventory costing |
Which of the following statements is NOT true?
A. | Under variable costing, a firm can report a higher income merely by incresing production quantity. | |
B. | A common criticism of absorption costing is that it provides incentives to produce nmore than what is necessary to satisfy demand. | |
C. | By discouraging wasteful use, cost allocations can induce efficient utilization of resources shared by multiple users. | |
D. | Under absorption costing, the finished goods inventory account will contain the fixed manufacturing costs of units produced but not sold. |
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