Accountants Prefer the Variable Costing Method Over Absorption Costing Method

question 41

Multiple Choice

Accountants prefer the variable costing method over absorption costing method for evaluating the performance of a company because

• A) by using the absorption costing method,income could appear to be higher by producing more inventory.
• B) by using the absorption costing method,income could appear to be lower by producing more inventory.
• C) by using the variable costing method,the cost of goods sold will be higher as more units are manufactured and sales remain the same.
• D) by using the variable costing method,all fixed and variable costs are included in the unit cost of the product manufactured.

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Definitions:

Pedophiles

Adults who are sexually attracted to prepubescent children, which is a psychiatric disorder and subject to legal consequences.

Unpredictability

The quality of being unable to be predicted or foreseen, often leading to a sense of uncertainty or variability in outcomes.

Stressful

Characterized by or causing stress or anxiety.

Thalamus

The thalamus is a small structure within the brain that serves as a relay station for information between the rest of the brain and the body, playing a key role in processing sensory information and regulating consciousness.