The Level of Inventory of a Manufactured Product Has Increased

question 35

Multiple Choice

The level of inventory of a manufactured product has increased by 7,000 units during a period. The following data are also available: The effect on operating income if absorption costing is used rather than variable costing would be a

• A)$42,000 decrease
• B)$42,000 increase
• C)$52,500 increase
• D)$52,500 decrease

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Definitions:

Frictional Unemployment

Unemployment that results because it takes time for workers to search for the jobs that best suit their tastes and skills

Job Losers

Individuals who have been involuntarily terminated or laid off from their employment.

Data On Unemployment

Statistical information relating to the number of unemployed individuals in the workforce, often presented as an unemployment rate.

Frictional Unemployment

Short-term unemployment that occurs when people are between jobs or entering the workforce for the first time, often seen as a natural part of a healthy economy.