A disadvantage of absorption costing is
A)that it is not a useful format for decision making.
B)that it assigns only manufacturing costs to the product.
C)all of these
D)none of these

Question

Quizplus · Accepted Answer

Absorption costing includes both fixed and variable manufacturing costs in the cost of a product, which can make it difficult to use for decision making purposes. In addition, absorption costing does not consider non-manufacturing costs such as selling and administrative expenses, which can be important when making pricing and product mix decisions.

A Disadvantage of Absorption Costing Is