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Q - Explain the main conceptual issue under variable costing and absorption costing regarding the timing for the release of fixed manufacturing...
Q – Explain the main conceptual issue under variable costing and absorption costing regarding the timing for the release of fixed manufacturing overhead as an expense.A - I am not sure if my answer is correct....Variable costing focuses attention on distinguishing variable manufacturing costs from fixed manufacturing costs. The distinction is important for short-run decision making.Absorption costing is cost effective and less confusing to managers to use one common method of inventory costing for both external and internal reporting and performance evaluation. Criteria – Provide valuable and thoughtful feedback for the above answer with constructive criticism and critiques. Present original thoughts and ideas in postings, (avoid simple agreement or disagreement with, or restatement of other's postings) You may want to provide additional information from your outside readings or other outside resources. I encourage you to share links to other excellent resources during this course.Reference - Horngren, C. T., Datar, S.M., Foster, G., Rajan, M., & Ittner, C. (2009). Cost Accounting: A Managerial Emphasis (13th ed.). Upper Saddle River, NJ: Pearson Prentice Hall.
AnswerVariable Costing is the costing in which variable costing is charged to the cost units and fixedcost is written off against the contribution .Under variable costing cost is divided into...