Absorption costing
This query is : Resolved
28 July 2011
wht is the difference between marginal and absorption costing??
28 July 2011
allocating all manufacturing costs to products regardless of whether they are fixed or variable. This approach is known as absorption costing/full costing
However, only variable costs are relevant to decision-making. This is known as marginal costing/variable costing
Absorption costing is costing system which treats all manufacturing costs including both the fixed and variable costs as product costs
Marginal Costing is a costing system which treats only the variable manufacturing costs as product costs. The fixed manufacturing overheads are regarded as period cost
g
However, only variable costs are relevant to decision-making. This is known as marginal costing/variable costing
Absorption costing is costing system which treats all manufacturing costs including both the fixed and variable costs as product costs
Marginal Costing is a costing system which treats only the variable manufacturing costs as product costs. The fixed manufacturing overheads are regarded as period cost
g
Message likes :
1 times
29 July 2011
ithanks sir
but one more question????
i read some where that in marginal costing cost sheet variance all are apllied in the starting or end of period but in absorption costing we can calculated even in middle months or on management discrection..,but in marginal costing we can calculate at the end or start of year...why this is soo???
but one more question????
i read some where that in marginal costing cost sheet variance all are apllied in the starting or end of period but in absorption costing we can calculated even in middle months or on management discrection..,but in marginal costing we can calculate at the end or start of year...why this is soo???
29 July 2011
Both the methods are can follow any of the time, only Marginal costing we need to have data of Variable cost and fixed cost
Message likes :
1 times
29 July 2011
I agree with the expert
30 July 2011
I agree with the expert
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Gst registered proprietorship firm
- TDS Challan - change of FY 2025-26 to TY 2026-27
- Price inclusive or exclusive of GST while made entry in P& L Account
- AUDITOR APPOINTMENT FOR THE YEAR ENDING MARCH 27
- Minimum tax payable to file Updated return
- TDS on Fixed Assets purchased
- TDS on purchase of under construction property from a reseller
- GST Intimation due to Government took possession of Business Premises under PPE Act
- GST ISSUE OF INPUT AND OUTPUT GST
- Change Of Karta In Case of Death
- How to Handle Active E-Invoices in GST Portal Deleted from Tally?
- IMPORT PURCHASE ENTRY PASSED IN BOOKS OF ACCOUNT
- FAST DS 26 Undisclosed Foreign Asset Disclosure Scheme 2026
- Starting trading business
- Regime change
- Goods sold but invoice not issued
- Tally: Imported bank entries do not show up in manual reconciliation
- Sales of goods of amount Rs97 lakhs to a party
- Confused About My Career After 12th — Cyber Security, AI or Finance? Need Guidance
- FAST-DS 2026 Under Tax Law - No recourse or support for person declaring via this scheme?
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
