Absorption or variable

Exercise and reference answers

Questions

1. Answer

   Absorption

   Question

   Puts fixed overhead into each unit

   Choices

   1. Absorption
   2. Variable

2. Answer

   Variable

   Question

   Expenses fixed overhead at once

   Choices

   1. Variable
   2. Absorption

3. Answer

   Absorption

   Question

   Accepted for GAAP reporting

   Choices

   1. Absorption
   2. Variable

4. Answer

   Absorption

   Question

   Required for United States tax

   Choices

   1. Absorption
   2. Variable

5. Answer

   Absorption

   Question

   Also called full costing

   Choices

   1. Absorption
   2. Variable

6. Answer

   Variable

   Question

   Also called direct costing

   Choices

   1. Variable
   2. Absorption

7. Answer

   Variable

   Question

   Also called marginal costing

   Choices

   1. Variable
   2. Absorption

Instructions

Pick the right method each time. Too many wrong picks and the tower falls.

Explanation