When the Number of Units Produced Is Less Than the Number

question 230

Multiple Choice

When the number of units produced is less than the number of units sold, how does operating income under variable costing differ from operating income under absorption costing?

• A)It is lower than operating income under absorption costing.
• B)It is higher than operating income under absorption costing.
• C)It is the same as operating income under absorption costing.
• D)It depends upon the amount of decline.

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