Question

Difference between marginal costing and direct costing

Answer 1

Marginal costing is simply a technique to analyze cost information for decision making process. Different terms are used to describe this costing technique. In UK, this is called marginal costing whereas in US,it is commonly known as direct costing, variable costing or contribution costing.Direct costs are costs directly tied to a product or service that a company produces. Direct costs can be easily traced to their cost objects. Cost objects can include goods, services, departments, or projects.