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  • Variable Costing Lecture

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    ralfgerwin inesa
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    Variable costing and absorption costing are two different accounting methods for allocating fixed manufacturing overhead costs. Variable costing treats fixed costs as period costs rather than allocating them to inventory, which results in higher reported income when production is below capacity. Absorption costing allocates all manufacturing costs, including fixed overhead, to inventory, resulting in a higher cost of goods sold and lower reported income when production is below capacity.

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    Lecture notes on variable costing

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    Variable costing lecture

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    Variable costing and absorption costing are two different accounting methods for allocating fixed manufacturing overhead costs. Variable costing treats fixed costs as period costs rather than allocating them to inventory, which results in higher reported income when production is below capacity. Absorption costing allocates all manufacturing costs, including fixed overhead, to inventory, resulting in a higher cost of goods sold and lower reported income when production is below capacity.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    12 views10 pages

    Variable Costing Lecture

    Uploaded by

    ralfgerwin inesa
    Variable costing and absorption costing are two different accounting methods for allocating fixed manufacturing overhead costs. Variable costing treats fixed costs as period costs rather than allocating them to inventory, which results in higher reported income when production is below capacity. Absorption costing allocates all manufacturing costs, including fixed overhead, to inventory, resulting in a higher cost of goods sold and lower reported income when production is below capacity.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    of 10

    STRATEGIC

    BUSINESS
    ANALYSIS
    VARIABLE
    COSTING VS
    ABSORPTION
    COSTING
    VARIABLE VS ABSORPTION COSTING
    COMPARISON BETWEEN VARIABLE COSTING AND ABSORPTION COSTING
    (CONTINUATION)

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