Business Glossary

Business: a cost that is treated as an expense rather than passed on to a customer.

Also, a firm merged into an acquiring company.
Cost accounting: indirect manufacturing costs (such as property taxes and insurance) are called absorbed costs. They are differentiated from variable costs (such as direct labor and materials). See also direct overhead.
Finance: an account that has been combined with related accounts in preparing a financial statement and has lost its separate identity. Also called absorption account or adjunct account.
Securities: issue that an underwriter has completely sold to the public.

Also, in market trading, securities are absorbed as long as there are corresponding orders to buy and sell. The market has reached the absorption point when further assimilation is impossible without an adjustment in price.

1. to assimilate, transfer, or incorporate amounts in an account or a group of accounts in a manner in which the first entity loses its identity and is "absorbed" within the second entity. Examples include the sequential transfer of xpenditure account amounts to work-in-process (WIP), finished goods, and cost of sales.
2. to distribute or spread costs by the process of proration or allocation. See also absorption costing.