Kategorien: Alle - production - costing - decisions - control

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107

DIRECT AND ABSORBENT COSTING

Direct and absorbent costing methods play crucial roles in accounting and managerial decision-making. Direct costing focuses on variable costs and excludes fixed costs from product valuation, which can simplify decision-making but may not fully represent the financial health of a company.

DIRECT AND ABSORBENT COSTING

Direction of the company

Control
Sources

Supply

Budget trustworthy
costs

accounting records

both costs
Establishment

optimal combination

Volume

Utility

Cost

balance point

complex

Fixation

Prices
Determine

Total cost

accounting principle

reflects the fixed costs

Level of production finished

Certain

Universal

accepted system
Profesión contable

physical

Valuación

process and finished

Higher

direct costing

Disadvantages

principle of accounting

Accounting period
does not reflect the fixed costs

production level

determined period

generate

disorients

unit costs
Minors
inventories
lower

Tradicional información

Decisions

Incomplete costing

Statement of income
loss caused

Ability not factory used

Advantage

have

Better control
sources

utilities

Comparison

units
values

Various periods

Obtaining

Break-even point

Fluctuations

Unit cost

DIRECT AND ABSORBENT COSTING

Absorbent costing

Apply
Costing

valuation

Distribution

fixed costs

Variable costs

Manufacturing costs

Acknowledged
Method

Valuation

inventory

Purposes

External reports

Costs
Fixed

Variables

Include

Product

DIRECT COSTING

Production
Fixed costs

Constants

the capacity

Produce or sell an item

enough information
Company address

Process

planningstrategic

System
Operation

Evaluate

Sales cost

Variable manufacturing cost

Inventory

Variable Costs

assigned

Products