Variable Costing and Absorption Costing under the traditional costing approach, absorption costing, or full costing, products absorb all costs incurred to product them which can result in misleading product cost information for decision-making. Under variable costing only costs that change in total with changes in production level are included in product costs. The difference between the two costing methods is the exclusion of fixed overhead from product cost for variable costing. Post your response and ideas of the following questions:

1) What are the benefits of using variable costing when striving to control costs? Are these benefits available under absorption costing?

2)How can the use of absorption costing result in overproduction?

3) How will net income under variable costing compare to net income under absorption costing when units produced exceed units sold situation?

Grading guidelines:

• This discussion problem requires students to develop critical thinking skills and accounting research abilities.
• Ensure that the posting contributes to the overall discussion thread that is being developed.
• Your response must contain some reference back to the original discussion questions. Stay on track by always referring back to that original discussion questions.
• Make sure that each answer is at least 50-120 words.