Answer
No, I don't agree. The main concern with variable costing is not that it ignores the importance of fixed costs but rather that it defers their recognition as an expense until the products are sold. This can create fluctuations in reported profits when production levels change. Absorption costing, on the other hand, includes fixed manufacturing costs in the product's cost, which can provide a more stable picture of profitability. The choice between these methods depends on a company's preference for how it wants to allocate and recognize fixed costs, rather than the importance of fixed costs in manufacturing.
Work Step by Step
Refer to the variable costing concept to have a more concrete idea about the topic.
