All differences between super-variable costing and absorption costing net operating income are explained by the accounting for direct materials costs.

Question

Quizplus · Accepted Answer

The differences between super-variable costing and absorption costing net operating income are not solely explained by accounting for direct materials costs. The differences are also affected by the accounting for fixed manufacturing overhead costs and the timing of their recognition. Under absorption costing, fixed manufacturing overhead costs are included in the cost of goods sold and inventory, while under super-variable costing, they are expensed as period costs. This can result in differences in reported net operating income between the two costing methods.

All Differences Between Super-Variable Costing and Absorption Costing Net Operating