A: Fixed overheads are ignored in marginal costing. R: Marginal costing only considers variable costs for decision making. Choose the correct option. MCQ with Answer and Explanation
A: Fixed overheads are ignored in marginal costing. R: Marginal costing only considers variable costs for decision making. Choose the correct option.
A. A is true but R is false
B. Both A and R are true but R is NOT the correct explanation of A
C. A is false but R is true
D. Both A and R are true and R is the correct explanation of A
Answer: Option B
Solution (By JKSSB Mock Tests)
In marginal costing, fixed overheads are treated as period costs and are not included in the cost of production. This is because marginal costing focuses on variable costs for short-term decision making. Both are true, but R is the underlying principle, not just an explanation of ignoring fixed costs.
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