Which of the following concepts is most compatible with absorption costing in a manufacturing environment?
A)"the whole world is the market and the whole world is the competitor"
B)niche marketing
C)flexible manufacturing
D)continuous improvement
E)matching revenue to expense for financial reporting

Question

Quizplus · Accepted Answer

Absorption costing is a method of costing in which all manufacturing costs are absorbed by the units produced. This includes direct materials, direct labor, and both variable and fixed manufacturing overhead costs. Matching revenue to expense for financial reporting is the most compatible concept with absorption costing as it ensures that all the costs incurred in manufacturing a product are accounted for and matched with the revenue earned from selling that product.

Which of the Following Concepts Is Most Compatible with Absorption