Difference between actual costing and normal costing

True Tamplin

Written by True Tamplin, BSc, CEPF®
Updated on June 22, 2021

Normal Costing:

Normal costing refers to a product costing system where actual direct material, actual direct labor and applied manufacturing overhead costs are added to work in process inventory.

Actual Costing:

Actuar costing system refers to a product costing system where actual direct material and actual direct labor and actual manufacturing overhead costs are added to work in process inventory.

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