Variable Costing Net Operating Income Is Usually Closer to the Net

question 189

True/False

Variable costing net operating income is usually closer to the net cash flow of a period than is costing absorption net operating income.

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Definitions:

Interest Rate

The percentage of a loan amount charged to the borrower or paid to an investor, serving as the cost of borrowing or the return on investment.

Accounting Profits

The net income for a company as calculated through the standard accounting principles, reflecting revenues minus costs and expenses.

Savings Account

A bank account that earns interest on the deposited funds, offering a safe way to save money for future use.

Interest Rate

The percentage of a sum of money charged for its use, typically expressed as an annual percentage.