When There Is No Beginning Finished Goods Inventory and All

question 260

Multiple Choice

When there is no beginning Finished Goods Inventory and all the goods that are produced are sold,the operating income ________.

• A) will be higher under absorption costing than variable costing
• B) will be lower under absorption costing than variable costing
• C) will be higher than the gross profit under variable costing
• D) will be the same for both absorption costing and variable costing

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Definitions:

Evaluated

The process of examining something systematically to determine its merit, value, or significance based on established criteria.

Monitored

Being watched, checked, or tracked, especially for progress or compliance.

Viability

The capability of being successful or effective; the ability to exist, grow, or develop.

Oriented Manager

A manager who is focused or directed towards specific goals, outcomes, or orientations such as customer, sales, or product.