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For a manufacturing company what is the most Importantadvantage of using variable costing rather than absorption costing?
- A . Variable costing includes only variable direct and indirect costs in inventory which makes it more useful for short-term decision making and performance evaluation.
B. Variable costingis the required inventory method for external reporting in most countries and therefore is less costly to implement
C. Variable costing is cost-effective and Jess confusing to managers and is therefore more useful in performance evaluation.
D. Variable costing measures the cost of all manufacturing resources, whether variable or fixed and thus provides the most complete cost.
Suggested Answer: A
Posted : 18/01/2023 5:13 pm