1) Which of the following costs is inventoried when using variable costing?
A) rent on factory building
B) electricity consumed in manufacturing process
C) sales commission paid on each sale
D) advertising costs incurred for the product
Answer: B
Diff: 1
Objective: 1
AACSB: Application of knowledge
2) Which of the following costs is inventoried when using absorption costing?
A) variable selling costs
B) fixed administrative costs
C) variable manufacturing costs
D) fixed selling costs
Answer: C
Diff: 1
Objective: 1
AACSB: Analytical thinking
3) ________ is a method of inventory costing in which all variable manufacturing costs (direct and
indirect) are included as inventoriable costs and all fixed manufacturing costs are excluded.
A) Variable costing
B) Mixed costing
C) Absorption costing
D) Standard costing
Answer: A
Diff: 1
Objective: 1
AACSB: Analytical thinking
4) ________ is a method of inventory costing in which all variable manufacturing costs and all fixed
manufacturing costs are included as inventoriable costs.
A) Variable costing
B) Mixed costing
C) Absorption costing
D) Standard costing
Answer: C
Diff: 2
Objective: 1
AACSB: Analytical thinking
1
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