Which Inventory Costing Method Calculates Operating Income

question 4

Multiple Choice

Which inventory costing method calculates operating income?

• A) Absorption costing
• B) Gross margin costing
• C) Variable costing
• D) Both absorption and variable costing

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Definitions:

Profitable Product Lines

Specific categories of products that generate more revenue than the costs associated with their production and marketing.

Unassembled Product

Product components that have not yet been put together or manufactured into a final product.

Assembled Product

An assembled product refers to a finished product that has been put together from various components or parts.