The Level of Inventory of a Manufactured Product Has Increased

question 151

Multiple Choice

The level of inventory of a manufactured product has increased by 8,000 units during a period. The following data are also available: What would be the effect on income from operations if absorption costing is used rather than variable costing?

• A) $80,000 decrease
• B) $80,000 increase
• C) $104,000 increase
• D) $104,000 decrease

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Definitions:

Sign Post

An indication or guide that provides direction or information, either literally in the form of a physical marker or metaphorically in speech or writing.

Complete Sentence

A group of words that expresses a complete thought, typically containing a subject and a predicate.

Audience-centered

An approach to communication that tailors the message to the preferences, interests, and expectations of the intended audience.

General Purpose

The broad, overarching goal or intent behind an action, strategy, or communication.