Participation Exercise #8 Assignment Example | Topics and Well Written Essays - 250 words

Participation Exercise 8 - Assignment ExampleThe system of costing assumes that tout ensemble be of the business need absorbing in the provision of a price to provide for total insurance coverage of costs to have realistic profits. The system of accounting registers the costs on each sale and allows instruction to push forward the costs of unsold products to next period until when the products are sold (Kaplan Financial Limited). These fit the major differences between it and variable costing that only considers the cost of the products during the time when they are produced. These explain why the absorption costing system is supported by the GAAP while variable costing is relevant for internal purposes majorly.One of the major efficiencies of absorption costing is its ability to provide for inventory valuation purposes since all stocks that are sold are covered in the cost of sales while those unsold stop accounted for until their point of sale.Kaplan Financial Limited, Margi nal and Absorption Costing, Costing. Kaplan Financial Knowledge Bank 2012. Viewed on May 07, 2015 from