The costing method that can be used most easily with break-even analysis and other cost-volume-profit techniques is:
A) variable costing.
B) absorption costing.
C) process costing.
D) job-order costing.

Question

Quizplus · Accepted Answer

Variable costing separates fixed and variable costs, allowing for easier analysis of the relationship between costs and revenue. This method aligns well with break-even analysis and other cost-volume-profit techniques, which rely on understanding how changes in volume and revenue affect costs and profits. Absorption costing, process costing, and job-order costing do not separate fixed and variable costs in the same way, making them less compatible with these techniques.

The Costing Method That Can Be Used Most Easily with Break-Even