Marginal and Absorbtion (Accounting)

[SpoonyVoid]

Hi

Would someone be kind enough as to explain the uses and limitations of Marginal and Absorption Costing?
Oh and why Profits differ when Marginal and Absorption costing are used?

These are the only theory parts in the syllabus I'm not exactly sure of. It would be great if someone could help me out Thanks a lot! And good luck for Accounts Paper 2!

 

[khalid]

marginal costing is als called internal costing becoz it is used for decision making and absorption costing is for external use and its like published accounts .the rofit differ becoz of de value of closing stock..... in marginal costin, fixed prodution cost is not inclded and in absortpion it iz included. dis creates difference in cost of sales and then in profit