Absorption costing is required for reporting to which of the following groups?
A) The SEC
B) The IRS
C) Senior Management
D) A and B only
E) A, B, and C

Question

Quizplus · Accepted Answer

Absorption costing is required by the Securities and Exchange Commission (SEC) for external reporting purposes and by the Internal Revenue Service (IRS) for tax reporting, making both A and B correct. Senior management may use various costing methods for internal decision-making, so C is not a requirement.

Absorption Costing Is Required for Reporting to Which of the Following