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(a) Explain and give examples where appropriate, how costs may behave in response to changes in the level of a business's activity. (b) Describe the
- (a)Explain and give examples where appropriate, how costs may behave in response to changes in the level of a business's activity.
- (b)Describe the basis of an absorption costing and a marginal costing system;
- (c)Explain the effect on profit of using each system described in part (b) above, in each of the following scenarios:(i)Where production levels exceed sales levels;
(ii)Where sales levels exceed production levels;(iii)Where sales levels equal production levels.
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