Answer to the question no: 1
(1)Answer: Objectives of preparing financial statement using variable costing and absorption costing:
Variable costing:
(1)Product cost or all associated manufacturing cost must be variable fixed cost will not be included.
(2)It is uses by internal management to make decisions.
(3)Internal management can increase or decrease variable expenses that will creat net operating income more.
Absorption costing:
(1)Absorption costing means full costing it included Production related all associated fixed and variable cost.
(2)In follow to make income statement for the external users to make decisions that they invest in this business or not. Because it show the organization profitability or financial condition.
(3)In absorption costing follow GAAP that's why it use to make financial statement.
Answer to the question no: 2
(2)Answer: Yes, an organization can follow variable and absorption costing system at the same time. Because variable costing is used by internal management to take decisions and that will they increase variable expenses or will they decrease? to make profit they make this decision using variable costing.
Absorption costing use for the external users. Absorption costing follow GAAP. An organization can also use this costing system to become acceptable for the external user or investor that they agree to invest in their business through showing the financial conditions of the business or income statement because this statement prepare through using absorption costing system.