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Another name for marginal costing is variable costing. This approach focuses on the variable costs associated with production while excluding fixed costs from product cost calculations. It is often used for internal decision-making and helps in assessing the impact of production volume on profitability.
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Is the marginal costing called direct costing?
Yes marginal costing is also sometimes called direct costing.
What is marginal costing techniques?
There are two type of costing are involved in a product or service. ie Direct cost and Indirect cost. In this two head there are two sub type costing are involved. ie Varriable cost and Fixed cost. Here the the total varriable cost are involved in a product of cost is called marginal costing. In another way the totoal cost -fixed cost is called marginal costing By M.Magesh 099948 33079
What are the long term relationship between fixed cost and marginal costing?
In the long term, fixed costs and marginal costing interact significantly in decision-making and financial analysis. Fixed costs remain constant regardless of production levels, while marginal costing focuses on variable costs incurred for each additional unit produced. Businesses often use marginal costing to assess the impact of production decisions on profitability, as it highlights the contribution margin above fixed costs. Understanding this relationship helps companies in pricing strategies, budgeting, and optimizing resource allocation over time.
Why marginal costing method not Suitable to be used by manufacturer for external financial reporting and tax purpose?
I think..... In marginal costing method only variable cost is considered as product cost and fixed cost is not considered as product cost. But in reality product cost include fixed and variable, thus both variable and fixed costs should be considered while allocating cost. Marginal costing is used for inside reporting and absorption costing is used for outsider to clarify the real cost of product........ Am i right? Please confirm it
How is marginal costing more useful than arbsorption in make or buy decisions?
Marginal costing focuses on variable costs, making it more useful in make or buy decisions because it highlights the incremental costs associated with production. This approach aids in identifying the true cost of producing an additional unit versus purchasing it from an external supplier. By emphasizing relevant costs, marginal costing enables businesses to make informed decisions that enhance profitability and resource allocation. In contrast, absorption costing includes fixed overheads, which can obscure the true economic implications of the decision.
Limitation and assumption of marginal costing?
assumption of marginal costing
Is the marginal costing called direct costing?
Yes marginal costing is also sometimes called direct costing.
Is another term for variable costing?
It May Be Called as "Marginal Cost"
What is another term for variable costing?
It May Be Called as "Marginal Cost"
When to use marginal costing?
Marginal costing is the method of costing for evaluating the changes in total cost due to change in number of units produced.
Difference between absorption and marginal costing?
marginal costing is recommended by IAS and absorption costing is not recommended by IAS,marginal costing is used for internal purposes and absorption costing is ysed for external purposes,in marginal costing the fixed production overheads are not calculated as a product cost and in absorption costing the fixed prodution overheads are calculated as product cost.
What is marginal costing techniques?
There are two type of costing are involved in a product or service. ie Direct cost and Indirect cost. In this two head there are two sub type costing are involved. ie Varriable cost and Fixed cost. Here the the total varriable cost are involved in a product of cost is called marginal costing. In another way the totoal cost -fixed cost is called marginal costing By M.Magesh 099948 33079
What are the uses of marginal costing and absorption costing?
to calculate the profit easilly
Is direct costing the same as variable costing?
Variable costing is called marginal costing while direct costing is separate concept.
Marginal costing and absorption costing which is favourable?
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What is another name for variable costing?
'''Direct Costing'''
What is another name for absorption costing?
Full costing system
