Question

An income statement under absorption costing includes which of the following: ______________

Answer 1

Answer:

a. Direct materials

b. Direct labor

c. Variable overhead

d. Fixed overhead

Explanation:

The absorption costing is the costing in which the income statement should includes all types of production cost i.e. direct material cost, direct labor cost, variable overhead and the fixed overhead

So as per the given statement, all the four types of costing should be involved while preparing the income statement under the absorption costing

Hence, all 4 options should be considered