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MARGINAL COSTING AND DIFFERENTIAL COSTING
1. Differential costing can be used both in case of marginal costing and absorption costing.
2. In case of marginal costing, fixed costs are not included and just variable costs are measured while in the case of differential costs, both are measured.
3. Separate analytical statements are created while calculating the differential costing while in the case of marginal costing, marginal costs may be included in the accounting itself.
4. In the case of contribution, marginal costing and profit-volume proportion are the important yardsticks for performance valuation and decision-making. Whereas in the case of differential costing, differential costs are evaluated with differential revenue for decision-making.
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explain advantages of marginal costing
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discuss stages of accounting for costs
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The basic principles of standard costing and variance analysis may be adapted to the needs of relatively new methods of accounting such as activity-based cost
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