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Cost Accounting

Thursday, March 25, 2010. Limitations of Absorption Costing. The following are the criticisms against absorption costing:. You might have observed that in absorption costing, a portion of fixed cost is carried over to the subsequent accounting period as part of closing stock. This is an unsound practice because costs pertaining to a period should not be allowed to be vitiated by the inclusion of costs pertaining to the previous period and vice versa. Marginal cost is the cost management technique for the...

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