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    What is the major rationale for the use of variable costing? Discuss why variable costing may not be used for financial reporting purposes.

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    What is the major rationale for the use of variable costing? Discuss why variable costing may not be used for financial reporting purposes.

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    https://brainmass.com/business/accounting/variable-costing-financial-reporting-494538

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    Under variable or direct costing, the fixed manufacturing overhead costs are not allocated or assigned to (not absorbed by) the products manufactured. Variable costing is often useful for management's decision-making. However, absorption costing is required for ...

    Solution Summary

    This solution outlines the principle of variable costing and discusses why it may not be used for financial reporting purposes.

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