As the name states, in variable costing method, only the variable manufacturing costs are included in the product cost (Lazol, 2011: 132), irrespective of whether the cost in question is direct or indirect. Within the scope of variable costing method, all fixed costs are considered as period expenses, suggesting that fixed costs would still exist even if there were no production and this makes those factors irrelevant for calculating the manufacturing cost. Only the variable manufacturing costs are treated as product costs under variable costing method, variable non-manufacturing costs are excluded despite their variable nature.