Cost Accounting (15th Edition)

Published by Prentice Hall
ISBN 10: 0133428702
ISBN 13: 978-0-13342-870-4

Chapter 9 - Inventory Costing and Capacity Analysis - Assignment Material - Questions - Page 358: 9-5

Answer

No, I don't agree. The choice between absorption costing and variable costing depends on various factors, including how a company wants to account for fixed manufacturing costs. It's not solely based on whether variable cost/fixed cost distinctions are made. Companies can use absorption costing even if they make such distinctions, and vice versa. The choice depends on the company's accounting and reporting preferences.

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