Explain Features of Marginal costing?
Submitted by: AdministratorFeatures of Marginal costing:
- It is a method of recoding costs and reporting profits.
- It involves ascertaining marginal costs which is the difference of fixed cost and variable cost.
- The operating costs are differentiated into fixed costs and variable costs. Semi variable costs are also divided in the individual components of fixed cost and variable cost.
- Fixed costs which remain constant regardless of the volume of production do not find place in the product cost determination and inventory valuation.
- Fixed costs are treated as period charge and are written off to the profit and loss account in the period incurred.
- Only variable costs are taken into consideration while computing the product cost.
- Prices of products are based on variable cost only.
- Marginal contribution decides the profitability of the products.
Submitted by: Administrator
- It is a method of recoding costs and reporting profits.
- It involves ascertaining marginal costs which is the difference of fixed cost and variable cost.
- The operating costs are differentiated into fixed costs and variable costs. Semi variable costs are also divided in the individual components of fixed cost and variable cost.
- Fixed costs which remain constant regardless of the volume of production do not find place in the product cost determination and inventory valuation.
- Fixed costs are treated as period charge and are written off to the profit and loss account in the period incurred.
- Only variable costs are taken into consideration while computing the product cost.
- Prices of products are based on variable cost only.
- Marginal contribution decides the profitability of the products.
Submitted by: Administrator
Read Online Marginal Costing Job Interview Questions And Answers
Top Marginal Costing Questions
☺ | What is Optimizing Product Mix? |
☺ | Explain Break Even Point. How does BEP help in making business decision? |
☺ | What is P/V Ratio? |
☺ | What is Fixation of Selling Price? |
☺ | What is Cost Volume-Profit relationship? |
Top Finance and Accounts Categories
☺ | MBA Finance Interview Questions. |
☺ | Bank Teller Interview Questions. |
☺ | Capital Market Interview Questions. |
☺ | Cashier Interview Questions. |
☺ | Bank Reconciliation Interview Questions. |