A Company That Uses Standard Costing Wishes to Reconcile the Difference

question 31

Multiple Choice

A company that uses standard costing wishes to reconcile the difference between the profit for a period calculated using absorption costing with that calculated using marginal costing. Which TWO of the following will NOT help with this reconciliation? (Choose two.)

• A) The actual fixed production overheads.
• B) The closing inventory.
• C) The opening inventory.
• D) The under or over absorbed fixed production overheads.
• E) The fixed production overhead absorption rate.

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Definitions:

Corporate Chain

A series of related businesses owned by the same company or managed under a single corporate structure, often sharing branding and operational systems.

Independent Retailer

A retail establishment owned and operated by an individual or group, not part of a larger chain of stores.

Quality Personal Service

High-caliber, individualized attention or services provided to customers, ensuring their needs and expectations are met with a personal touch.

Corporate Chains

networks of retail or service outlets operated by a single company, offering the same brand and format across locations.