Questions:
1. Define ‘Marginal Cost and ‘Marginal Costing. How variable and fixed costs are treated in marginal costing? Give a journal entry for overhead accounts under marginal costing.
2. State the utility of marginal costing in price fixation during trade depression and for export purposes.
3. Discuss the differences between the marginal costing and absorption costing.
4. State how the ascertainment of behaviour of overhead expenses under varying conditions of production and sales facilitates both, cost control and decision making.
5. Discuss the importance of the following terms in relation to marginal costing.
A] Key factor B] Break even point C] Margin of safety