When Production Is Greater Than Sales

question 1

Multiple Choice

When production is greater than sales

• A)net income under absorption costing will be greater than or less than net income under variable costing depending on the selling and administration costs.
• B)net income under absorption costing will be equal to net income under variable costing.
• C)net income under absorption costing will be less than net income under variable costing.
• D)net income under absorption costing will be greater than net income under variable costing.

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Definitions:

Unilaterally Mistaken

A situation where only one party to an agreement is confused about the terms or subject matter, potentially affecting the validity of the contract.

Contractual

Pertaining to, or characterized by, a contract or agreement between two or more parties.

Damages Recoverable

The amount of money that can be claimed or awarded as compensation for loss or injury in a legal action.

Dollar Limits

The maximum amount of money that can be claimed from a jurisdictional perspective or under a specific insurance policy.