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Marginal costing
In the 6th question of the pratical problem of the institute's textbook, how can we take the difference of budgeted and actuals to find the P/V RATIO ? What is the logic of this difference?
Answers (9)
Thread Starter
Swathi KrishnaBudgeted *
This means I wrote budgeted profits - actual profit gives us contribution
Thread Starter
Swathi KrishnaThis means I wrote budgeted profits - actual profit gives us contribution
The point is that since fixed costs do not change, profit variation is only on account of contribution.
