Full Costing


Full Costing
A managerial accounting method that describes when all fixed and variable costs, including manufacturing costs, are used to compute the total cost per unit. Full costing includes these costs when computing the amount of money it takes to produce and distribute one unit of output.

Full costing is also known as "full costs" or "absorption costing".

How a firm expenses its production and distribution costs will impact the structure of internal income statements. Because all costs incurred to sell a product are included with cost of goods sold, the firm's gross margin will be lower under the full costing method than the absorption costing method.


Investment dictionary. . 2012.

Look at other dictionaries:

  • full costing — UK US noun [U] ► ACCOUNTING ABSORPTION COSTING(Cf. ↑absorption costing) …   Financial and business terms

  • full costing method — full costs A method of costing a product or service that charges all the costs of an organization, both direct costs and overheads, to the cost unit. The full costing method usually takes the absorption approach to the costing of products and… …   Accounting dictionary

  • Калькуляция себестоимости полной (FULL COSTING)  — Отнесение всех возможных статей затрат на объект учета затрат (продукцию, например), как правило, для целей ценообразования, оценки прибыльности продукции и оценки запасов. В нефтегазодобывающей промышленности это капитализация и последующая… …   Словарь терминов по управленческому учету

  • costing — cost‧ing [ˈkɒstɪŋ ǁ ˈkɒːst ] noun [countable, uncountable] ACCOUNTING the process of calculating the cost of a future activity or product, or the calculation itself: • Railtrack originally said the scheme would cost £100 million, but last year… …   Financial and business terms

  • full costs — full costing method …   Accounting dictionary

  • full absorption costing — See: absorption costing …   Accounting dictionary

  • full cost pricing — An approach to setting selling prices that attempts to ensure that the price of a good or service is based on all the costs incurred in its supply, including overheads It usually involves an absorption approach to the costing of units. Compare… …   Big dictionary of business and management

  • absorption costing — ➔ costing * * * absorption costing UK US noun [U] (also full costing) ► ACCOUNTING a method of calculating the cost of a product where all fixed costs (= costs that are the same each month) are included → Compare MARGINAL COSTIN …   Financial and business terms

  • marginal costing — direct costing; = variable costing A costing and decision making technique that charges only the marginal costs to the cost units and treats the fixed costs as a lump sum to be deducted from the total contribution, in obtaining the profit or loss …   Accounting dictionary

  • absorption costing — full absorption costing; = total absorption costing The cost accounting system in which the overheads of an organization are charged to the production by means of the process of absorption. Costs are first apportioned to cost centres, where they… …   Accounting dictionary