Saturday, June 16, 2012

Calculation of profit under Marginal costing and Absorption costing


Calculation of profit under Marginal costing and Absorption costing

In marginal costing ,fixed production costs are treated as period cost and are written off as they are incurred.

In absorption costing , fixed production cost are absorbed into the cost of units and are carried forward in inventory to be charged against sales for the next period.

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