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What is meant by absorption?

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Anonymous

7y ago
Updated: 1/16/2023

Absorption costing is a methodology that seeks to account for all relevant costs into a finished good or product. This would include overheads as well as direct material or labor costs. This is usually not a accounting method used for sales or marketing but rather to gauge the actual costs of production and the cost of idling plant and machinery.

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Virgil Connelly

Lvl 10
2y ago

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absorption


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