Variable Costing

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  • April 22, 2011 at 12:50 am #160143
    Anonymous
    Inactive

    I am confused as to whether selling and admin variable costs should be used in calculating the contribution margin under variable costing. I’m using Becker and some questions include it in calculating it and some don’t.

    Please help!!!

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  • April 22, 2011 at 12:55 am #281342
    Harry
    Participant

    Yes it;s used to get your contribution margin. You take your revenues and then you subtract all your variable expenses including SG&A.

    BEC 77
    FAR 81
    AUD 97
    REG 75

    April 22, 2011 at 1:00 am #281343
    Anonymous
    Inactive

    Thanks Harry! Is it assigned to inventory?

    April 22, 2011 at 2:25 am #281344
    Harry
    Participant

    No because all SG&A (variable and fixed) are period costs. Meaning they are not part of inventory.

    BEC 77
    FAR 81
    AUD 97
    REG 75

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