Economics · Cost Accounting and Marginal Costing
Which of the following statements about Marginal Costing is correct?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1It is a technique used to ascertain the impact on profit of changes in volume by considering only the variable costs of production.✓
- 2It provides a reliable basis for long-term pricing decisions where full cost recovery is mandatory.
- 3It is a decision-making technique that facilitates the valuation of stock at total cost, including fixed costs.
- 4It treats all production overheads, both fixed and variable, as part of the cost of the product.
Correct answer
It is a technique used to ascertain the impact on profit of changes in volume by considering only the variable costs of production.
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