The Level of Inventory of a Manufactured Product Has Increased

question 153

Multiple Choice

The level of inventory of a manufactured product has increased by 5,000 units during a period. The following data are also available: What would be the effect on income from operations if variable costing is used rather than absorption costing?

• A) $50,000 decrease
• B) $50,000 increase
• C) $65,000 increase
• D) $65,000 decrease

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Definitions:

Musculocutaneous Nerve

A nerve in the arm that innervates the muscles of the anterior compartment of the forearm and provides sensation to the skin over the lateral aspect of the forearm.

Forced Expiration

The act of expelling air from the lungs with effort beyond normal exhalation.

Diaphragm

is the primary muscle used in the process of breathing, separating the thoracic cavity from the abdominal cavity.

External Intercostals

Muscles located between the ribs that help expand the chest cavity during inhalation.