Marginal Costing Definition:
Marginal Costing is a costing method that includes only variable manufacturing costs–direct
materials, direct labor, and variable manufacturing overhead–in
unit product cost. Marginal costing is also called
variable costing and
direct costing.
Marginal cost of the product = Direct
materials cost + Direct labor cost + Variable manufacturing overhead cost
Learn More About Marginal Or Variable Costing System:
- What is marginal/variable/direct costing?
- What is the purpose of using marginal costing
system?
- What are its advantages and disadvantages?
- How does marginal costing system differs from
absorption costing
system?
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