Question
Select any manufacturing company of your choice that produces any products. Describe and compare the marginal and absorption costing systems used in the selected company.
Criteria:
1) Importance of product cost information.
2) Production costs and their classification.
3) Description and explanation of the features of marginal costing and absorption costing.
4) Computation of product cost and preparation of financial performance statement using marginal costing and absorption costing.
5) Summary.
Additional information-
This question here belongs to Accounting and it is about absorption costing and marginal costing. An example of Reebok has been given in the solution. Reebok International has been one of the premium sportswear manufacturers which are best known for its sports sneakers and shoes worldwide. Reebok uses marginal costing to assess its stock and this process has been described in the solution.
Word limit- 3000.