The only difference between absorption costing and variable costing is the way that fixed manufacturing overhead costs are treated.

Question

Quizplus · Accepted Answer

Absorption costing includes fixed manufacturing overhead costs as part of the cost of each unit produced, while variable costing only includes variable manufacturing costs. This difference in treatment of fixed overhead costs is the main distinction between the two costing methods.

The Only Difference Between Absorption Costing and Variable Costing Is