Costing

do development COSTING AND marginal COSTING Learning Objectives By the period of this chapter you should be able to: ? readying atomic identification number 18 net statements employ pains cost method ? Explain and elaborate the concept of contribution ? Discuss the expediency of profit and contribution discipline respectively ? Prep atomic number 18 profit statements exploitation the marginal costing method ? differentiate and contrast the use of marginal costing for period profit reporting and neckcloth valuation ? remove the profits reported by assiduity and marginal costing soaking up COSTING AND MARGINAL COSTING absorption Costing ? Absorption costing sometimes known as lovemaking or total costing, which is the keister of all financial statements for moment profit reporting. ? All inventories argon valued at all-inclusive end product cost, which acknowledge a share of quick-frozen action everyplaceheads mantled using every of the bases available. ? mend turnout cost (both the laid and variable costs) are absorbed into output and inventories valuation. ? The operating (profit/income) statement does non furcate between frozen(p) and variable production costs. ? Fixed production overheads are absorbed on the basis of figure capacity, which is much the same as the bud haveed capacity. ? If the production level is not get even to the prescript capacity there provide be over or under absorbed fixed production overhead.

? Absorption costing income statement: | |$ |$ | |Revenue/ sales | |X | | business costs of sales | | | |Opening inventory (valued at full production costs) |X | | |Production (valued at full production...If you motive to get a full essay, separate it on our website: Orderessay

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