How important is it to trace costs appropriately? Explain.

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wraal37

Business Finance

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How important is it to trace costs appropriately? Explain.As you are beginning to think about the importance of tracing costs appropriately, please consider the differences between variable costing and absorption costing. What implications does each of these have on such things as financial reporting of profit and pricing your products for the marketplace? You may also want to think about the issues involved with traceable costs as discussed in our text or in articles that you may find online.

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How important is it to trace costs appropriately?
In the manufacturing, various costs are incurred before the final product is released to the
market. While some of these costs can be identified directly with much ease, some are
encountered as overheads which makes it difficult to account for them. Various costing and
absorption costing are different methods used for cost allocation and stock valuation. According
to (Göx, 200...


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