The product cost reported as inventoriable costs to shareholders may differ from product costs reported for government contracting.

Question

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The product cost reported as inventoriable costs to shareholders or investors may differ from product costs reported for government contracting. This is because different accounting rules and regulations may apply in each case, as well as different methods of costing and pricing products. For example, a company may use standard costing for its financial reporting purposes, but may be required to use actual costing or another method for government contracts. Additionally, the overhead rates, indirect costs, and other factors used for pricing products may be different for each market or customer group served by the company. Therefore, companies need to carefully consider their cost accounting practices and systems to ensure compliance with applicable rules and regulations, while also providing accurate and reliable information to shareholders and investors.

The Product Cost Reported as Inventoriable Costs to Shareholders May