The Level of Inventory of a Manufactured Product Has Increased

question 2

Multiple Choice

The level of inventory of a manufactured product has increased by 8,000 units during a period.The following data are also available: ​
What would be the effect on income from operations if absorption costing is used rather than variable costing?

• A) $80,000 decrease
• B) $80,000 increase
• C) $104,000 increase
• D) $104,000 decrease

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Definitions:

Thermal

Relating to heat; involving the movement or transfer of heat.

Chemical Energy

Chemical Energy is the potential of a chemical substance to undergo a transformation through a chemical reaction, resulting in the release or absorption of energy.

Taste Buds

Sensory organs on the tongue that are responsible for detecting and distinguishing the five elements of taste perception: sweet, sour, salty, bitter, and umami.

Organic Substances

Organic substances refer to chemical compounds that contain carbon-hydrogen bonds, typically associated with living organisms.