Variable costing is more useful than absorption costing in determining a company's break-even point.

Question

Quizplus · Accepted Answer

Variable costing separates fixed and variable costs, making it easier to determine the break-even point based solely on variable costs. On the other hand, absorption costing includes fixed costs in the calculation of product cost, which can make it difficult to determine the break-even point. Therefore, variable costing is more useful than absorption costing in determining a company's break-even point.

Variable Costing Is More Useful Than Absorption Costing in Determining