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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA MA – FIA FMA › marginal and absorption costing
which of the following are advantages of marginal costing over absorption costing ?
1. the accrual concept is applied fully
2.it helps that selling prices covers total costs
3.product cost are not distorted by arbitrary overhead absorption rate
4. the true behaviour of cost is reflected more accurately
There is no point in just setting me test questions and expecting me to answer. You must have an answer in the same book in which you found the question and so you should ask about whatever it is in the answer that you are not clear about – then I will help you.
I assume that you have watched my free lectures on this?
does the marginal costing follow accurals concept ?
No – because all fixed overheads are charged in the period in which incurred. They are not matched with the sales.