Absorption CostingA costing method that includes both direct costs (materials, labor) and indirect costs (overhead) into the cost of a product. This method provides a more complete picture of the total cost to produce an item. Related Articles:What are the Management Accounting Techniques? [Notes with PDF]Management Accounting TutorialTop 8 Differences between Product Cost and Period Cost [Notes with PDF]There are many differences between product cost and period cost. The cost that can be directly assigned to a product is known as the product cost.
