Variable and absorption costing - explanations | Accounting for Management
AccountingforManagement.org is a free website dedicated to teaching introductory financial and managerial Accounting. Variable and Absorption Costing is one of the topics listed as an Explanation. The purpose of the four pages of text with exampes is to 1) Explain the difference between variable costing and absorption costing approaches; 2) Compute the unit product cost under variable and absorption costing; 3) Prepare an income statement using variable and absorption costing and explain the difference in net operating income under two costing systems; and 4) Give advantages and disadvantages of variable costing system. The approximate time required to learn the content is 2 – 2.5 hours. Exercises, problems, and quizzes are also available from the site.