Asked by
Alyssa Warsalla
on Oct 15, 2024
Verified
Income under absorption costing will always be different than income under variable costing.
Absorption Costing
A costing method that includes all manufacturing costs, both fixed and variable, in the cost of a product.
Variable Costing
An accounting method that includes only variable production costs (costs that change with the level of output) in the cost of goods sold, highlighting the impact of production volume on profitability.
- Understand the impact of variations in production and sales volumes on income reporting using both costing approaches.
Verified Answer
RS
Learning Objectives
- Understand the impact of variations in production and sales volumes on income reporting using both costing approaches.
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