Explain why actual costing systems are rarely used in practice.
Actual costing systems are rarely used in practice because they do not provide accurate unit cost information on a timely basis.Actual per-unit overhead costs can vary dramatically from period to period because (1) actual costs vary from period to period and/or (2) the number of units produced may vary from period to period.Thus, when actual costing is used, a unit produced during a low-volume month may be assigned a higher cost than a unit produced during a high-volume month, even though the units are identical.

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The Answer of Explain why actual costing systems are rarely used in practice.
Actual costing systems are rarely used in practice because they do not provide accurate unit cost information on a timely basis.Actual per-unit overhead costs can vary dramatically from period to period because (1) actual costs vary from period to period and/or (2) the number of units produced may vary from period to period.Thus, when actual costing is used, a unit produced during a low-volume month may be assigned a higher cost than a unit produced during a high-volume month, even though the units are identical.

Explain Why Actual Costing Systems Are Rarely Used in Practice