Module 04 Discussion - Variable Costing Basics

After studying your assigned reading for this Module, please answer the following questions. Where you are unclear on concepts please ask questions in the forum. In your response, please try to clarify for a classmate, an area where he/she might have a question.

• Explain the difference between variable and full costing.
• Explain why income calculated under full absorption costing will be greater than income calculated under variable costing when production exceeds sales.
• Explain how a manufacturing company can "bury" fixed manufacturing costs in ending inventory under full absorption costing.
• If the fixed manufacturing overhead cost per unit under full costing is multiplied by the change in inventory between the beginning and ending of the period, what does the resulting number represent?

Please make your initial post by midweek, and respond to at least one other student's post by the end of the week. Please check the Course Calendar for specific due dates.

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