ACC 213 Exam 2 2023 LATEST EXAM GRADED A+

T/F: Under variable costing, only variable production costs are treated as product costs. - ANSWER True T/F: Under variable costing, variable selling and administrative costs are included in product costs. - ANSWER False T/F: Absorption costing treats all manufacturing costs as product costs. - ANSWER True T/F: In the preparation of financial statements using variable costing, fixed manufacturing overhead is treated as a period cost. - ANSWER True T/F: Absorption costing treats fixed manufacturing overhead as a period cost. - ANSWER False T/F: When the number of units in work in process and finished goods inventories increase, absorption costing net operating income will typically be greater than variable costing net operating income. - ANSWER True T/F: Net operating income computed using absorption costing will always be greater than net operating income computed using variable costing. - ANSWER False T/F: When production exceeds sales for the period, absorption costing net operating income will exceed variable costing net operating income. - ANSWER True T/F: Absorption costing net operating income is closer to the net cash flow of a period than is variable costing net operating income. - ANSWER False T/F: Variable costing is not permitted for income tax purposes, but it is widely accepted for external financial reports. - ANSWER False