Which of the Following Is a Reason for Companies Adopting

question 3

Multiple Choice

Which of the following is a reason for companies adopting variable costing for internal reporting purposes?

• A) It is cost-effective to use variable costing for both internal and external reporting.
• B) It reduces the incentives for undesirable buildup of inventories.
• C) It measures the cost of all manufacturing resources, whether variable or fixed, necessary to produce inventory.
• D) It assists in accurate pricing decisions in case of long-run pricing.

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