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    Absorption costing article summarized and explained

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    I need to summarize and comment on the below article, regarding absorption costing:
    Maskell, B. (2013). ABSORPTION COSTING IS THE ENEMY OF LEAN. CHRYSLER AND GM PROVED IT IN 2008. Blog posted Jan 30. Retrieved April 30, 2014 from http://blog.maskell.com/?p=559.

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    Maskell, B. (2013). ABSORPTION COSTING IS THE ENEMY OF LEAN. CHRYSLER AND GM PROVED IT IN 2008. Blog posted Jan 30. Retrieved April 30, 2014 from http://blog.maskell.com/?p=559.

    Maskell (2013) articulates nicely, giving examples from the automobile industry, how absorption costing can create poor decisions. He says that automobile manufacturers knew demand was dropping but if they slowed down production, the cost of cars would rise because fixed overhead would be spread (under absorption costing) to a small number of cars produced during the period. So, to ...

    Solution Summary

    This solution provides a discussion that is 369 words and a reference and discusses how absorption costing lead to the downfall of the automotive industry. References used are included.

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