You have just taken a job at a manufacturing company and have discovered that they use absorption costing to analyze product costs and subsequent cost-volume-profit decisions. You would like to introduce them to variable costing and explain to them why this costing method can be used and why it is helpful.

Compose a short email proposing a variable costing system and what that might mean for reports, analysis and comparisons.You could give a brief example if you feel that is necessary for your explanation to the president.