absorption costing
Definition
Method of costing a product in which all fixed and variable costs (however remote) are apportioned to cost centers where they are accounted for (absorbed) using absorption rates. This method ensures that all incurred costs are recovered from the selling price of a good or service, (assuming the final price is acceptable to the customers). Also called full absorption costing. See also direct costing, and marginal costing.
absorption costing is in the Accounting & Auditing, Decision Making, Problem Solving, & Strategy, Entrepreneurship, Management, & Leadership and Industries, Manufacturing, & Technology subjects.
absorption costing appears in the definitions of the following terms: full absorption costing, activity based costing (ABC), full costing, direct costing, backflush costing and absorption rate
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