The Level of Inventory of a Manufactured Product Has Increased

question 9

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:

Sensory Adaptation

The process by which sensory receptors become less sensitive to constant stimuli over time.

Absolute Threshold

The smallest level of stimulus that can be detected by a sense at least 50% of the time.

Target Stimulus

A specific stimulus aimed at eliciting a particular response in an experimental or learning context.

Signal-detection Theory

A framework describing how stimuli are detected under different conditions, highlighting the role of decision-making amidst noise.