Super-variable costing definition
/What is Super-Variable Costing?
Super-variable costing only considers totally variable costs to be part of the cost of inventory . All other costs are charged to expense in the period incurred. This typically means that only direct materials are included in the cost of inventory. Super-variable costing is only usable for internal reporting purposes, since it is not allowed under GAAP or IFRS . For external reporting purposes, factory overhead must also be allocated to the cost of inventory (which is called absorption costing ). Because of this issue, super-variable costing has seen limited application.
Terms Similar to Super-Variable Costing
Super-variable costing is also called throughput costing.
