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beneath the variable costing technique, all promoting and administrative (constant and variable) fees and glued production overhead is taken into consideration as part of the total period fee. hence, the whole length cost for the month beneath variable costing is $344,000.
underneath variable costing, fixed production overhead is handled as a period price and is charged in complete towards the modern length's profits. 7-2 promoting and administrative charges are dealt with as duration costs underneath both variable costing and absorption costing.
General period expenses encompass any prices that aren't at once related to product production. prison expenses, income commissions, and office components are considered length expenses and have to be recorded as expenses on the balance sheet.
length prices are fees that can't be capitalized on a company's balance sheet. In different phrases, they're expensed in the period incurred and appear at the profits statement. duration fees are also known as length fees.
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