In order to comply with Generally Accepted Accounting Principles (GAAP), companies must use absorption costing to report income statements. However, the most successful companies use variable and absorption costing methods for their managerial purposes.

• Select one publicly owned company and visit its website to find out the company's products and operations.
• Discuss the pros and cons of absorption and variable costing as the basis for the selected company's product costing.
• Examples of companies are Xerox Corporation, Firestone, Pepsi, Coca-cola, Motorola, Honda, Texas Instruments, etc.)