absorption n abc

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    densdumbo1
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    i dint understand…while calculating variable cost…are we supposed to multiply it with units produced or units sold ? ,…pls help


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    alua
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    think that way:
    If what you are trying to calculate is a COST, in this case variable one, then it doesn’t matter how many units you have sold, the cost arises in producing level, so what it counts is how much cost to produce x units. Then calculating revenue or profit you’ll take in account how many you have sold.

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