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FORUM DESCRIPTION How important is it to trace costs appropriately? Explain. As you are beginning to think about the importan
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Cost is very important elelment for every organisation. It is very essential to determining profitability of organisation. Knowledge about the various costing technique is very essential in determining the market price of a commodity. Variable costing is one of the important costing technoque in fixing price It is the cost of producing an additional unit. For example, if the current production of a company is 100 units, then the cost of producing 101th unit is the variable cost.Such a twchnoque is very important while we are determining the price foe special orders received by the company. Proice of a special orders or bulk orders are generally fixed by considering the variabke cost to be incurred by the special or bulk oreder.

Absorption costing is another costing technoque. It includes all the costs associated with manufacturing a product.It is otherwise called as full costing

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