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What is Variable vs. Absorption Costing Analysis about?

Under variable costing, fixed manufacturing overhead costs of $100,000 and variable selling costs of $80,000 for Cay Co. in 1995 would be classified as period costs totaling $180,000. Variable costing requires classifying fixed costs as period costs and calculating unit product costs using only variable costs. Absorption costing includes both fixed and variable manufacturing costs in overhead rates used to determine unit product costs. Unabsorbed fixed overhead costs in an absorption costing system are fixe

Author

Kekenn Escabas

Language

EN