--%>
Assignment Help - homework help

Limitations of Marginal Costing

Write down the limitations of Marginal Costing?

E

Expert

Verified

Limitations of Marginal Costing are illustrated below:

- The categorization of total costs into variable and fixed cost is hard.

- In this method fixed costs are completely eliminated for the valuation of inventory of finished and semi-finished goods. Such removal affects the profitability adversely.

- In marginal costing historical data is employed while management decisions are related to prospect events.

- It doesn’t give any standard for the valuation of performance.

- Selling price fixed on the base of marginal cost will be useful only for short period.

- Estimation of profitability on the marginal cost base can be employed only in the short period.

   Related Questions in Managerial Economics

  • Q : Illustrates the term long run

    Illustrates the term long run production function?

    		•
  • Q : Supply of labor in a perfectly

    The supply of labor within a perfectly competitive market is: (w) an upward sloping curve. (x) a horizontal line. (y) above the MRC. (z) below the MRC. Hello guys I want your advice. Please recommend some views for

    		•
  • Q : Unitarily inelastic supply of labor

    Glynn’s supply of labor is unitarily inelastic while the wage rate increases by: (1) $10 per hour to $20 per hour. (2) $10 per hour to $50 per hour. (3) $20 per hour to $50 per hour. (4) $20 per hour to $80 per hour. (5) $80 per hour to $90 per

    		•
  • Q : Value of the Marginal Product The value

    The value of marginal product of a variable resource is marginal physical product of it multiplied with: (w) the marginal revenue from the sale of its addition to output. (x) its cost. (y) the price of the product. (z) one.

  • Q : Human Capital Accumulation and the

    A society’s stock of human capital would be least probable to grow as a consequence of: (w) federal subsidies for college education. (x) sustained unemployment during a recession. (y) apprenticeship programs for construction workers. (z) retrain

    		•
  • Q : Explain the reasons for demand curve

    Explain the reasons for demand curve slopes downward.

    		•
  • Q : Competitive Profit Maximization in

    A profit-maximizing competitive firm hiring by a competitive labor market will be within equilibrium where is: (w) MPP = MRC. (x) w = MRC. (y) VMP = MPP. (z) VMP = w. Hey friends please give your o

    		•
  • Q : Illustrates the term Law of Demand

    Illustrates the term Law of Demand? Answer: The law of Demand is termed as the “first law in market”. It shows the relation in between quantity and price

    		•
  • Q : Illustrates the Objectives of

    Illustrates the Objectives of managerial economics?

    		•
  • Q : Explain the infinitely elastic demand

    Explain the infinitely elastic demand.

    		•