Mountainburg Industries has developed two new products but has only enough plant capacity to introduce one product during the current year. The following data will assist management in deciding which product should be selected.
Mountainburg's fixed overhead includes rent and utilities, equipment depreciation, and supervisory salaries. Selling and administrative expenses are not allocated to individual products. The advertising costs for the product selected by Mountainburg will be
A. Period costs.
B. Opportunity costs.
C. Prime costs.
D. Conversion costs.
Answer: A
Business
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