12. Product costs for absorption costing include direct materials, direct labor and A) fixed manufacturing overhead costs B) variable manufacturing overhead costs C) fixed and variable selling costs D) fixed and variable manufacturing overhead costs Answer 13. Under absorption-costing,fixed factory overhead costs appear only in cost of goods sold A) TRUE B) FALSE Answer: 14. When the number of units sold exceeds the number of units produced, net income under variable costingnet income under absorption costing. A) is less than B) exceeds C) equals D) not enough information to determine Answer 15. The overhead cost applied to a job is equal to the budgeted overhead rate times the budgeted amount of the cost driver. A) TRUE B) FALSE