What is difference between marginal costing & slandered Costing.

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Accepted Answer

Marginal costing focuses on variable costs while standard costing considers both variable and fixed costs.

Marginal costing only considers variable costs, such as direct materials and direct labor.
Standard costing includes both variable and fixed costs, such as direct materials, direct labor, and overhead costs.
Marginal costing is useful for short-term decision making, as it helps determine the contribution margin of each product or service.
Standard costing is more suitable for long-term planning and budgeting purposes.
Example: In a manufacturing company, marginal costing would only consider the direct materials and direct labor costs associated with producing a specific product. Standard costing, on the other hand, would also include the allocated overhead costs.
Example: If a company is deciding whether to accept a special order at a lower price, marginal costing would help determine if the contribution margin from the order covers the variable costs. Standard costing would provide a more comprehensive analysis by considering the impact on fixed costs as well.

What is difference between marginal costing &amp; slandered Costing.