When the Number of Units Produced Is Less Than the Number

question 285

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

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Definitions:

Cure

The complete resolution or eradication of a disease, leaving the individual with no ongoing symptoms or need for treatment.

Family Therapy

A form of psychotherapy that focuses on work with families and couples in intimate relationships.

Reframing

A strategy in which problems are restated so that they can be more easily dealt with.

Interacting

Engaging or influencing mutually or reciprocally between individuals or entities.