Which costing method matches costs and revenues most appropriately for generally accepted accounting principles?
A) Throughput costing
B) Absorption costing
C) Variable costing
D) Activity-based costing

Question

Quizplus · Accepted Answer

Absorption costing matches costs and revenues most appropriately for generally accepted accounting principles. It allocates both fixed and variable manufacturing overheads to the cost of goods sold, making it useful for inventory valuation and income measurement. It is also required by GAAP for external financial reporting.

Which Costing Method Matches Costs and Revenues Most Appropriately for Generally