A Company with Fixed Manufacturing Costs of $500,000 Produces 100,000

question 103

Multiple Choice

A company with fixed manufacturing costs of $500,000 produces 100,000 units in 2017 and 125,000 units in 2015.The company sells 90,000 units each in both years.Other costs and selling price are unchanged for 2017 and 2018.Assume that there was no beginning inventory in 2017.Which of the following is true?

• A)Variable costing income will be greater in 2017 than in 2018.
• B)The dollar amount of ending inventory will be greater in 2017 than in 2018.
• C)Variable costing income will be the same in 2018 and 2017.
• D)All of these answer choices are correct.