- Variable costing can exclude some direct fixed costs.
- Variable costing can provide a clearer picture of per-unit cost and inventory value because it excludes the fixed overhead cost.
- Absorption costing includes all of the direct costs associated with manufacturing a product.
- variable costing just follow variable cost but absorption costing work with both variable and fixed cost.
- variable costing does not follow GAAP but absorption costing follow GAAP.
- Management can control variable cost in their decision making.
- variable costing uses by internal user only but absorption costing uses by both internal and external.
