The Carrying Value of Finished Goods Inventory at the End

question 108

Multiple Choice

The carrying value of finished goods inventory at the end of the year under variable costing would be:

• A)$8,800 greater than under absorption costing.
• B)$8,800 less than under absorption costing.
• C)$5,800 less than under absorption costing.
• D)The same as absorption costing.

---

Definitions:

Cash Flow From Operations

A measure of the cash a company generates from its regular business activities, excluding costs associated with financing or investments.

Fixed Assets

Tangible assets held for a long duration, employed in business operations, and not anticipated to be converted into cash or consumed within a short period.

Financial Statements

Reports that provide an overview of a company's financial condition in an accounting period, including the income statement, balance sheet, cash flow statement, and statement of changes in equity.

Statement of Changes

A financial statement that reports on the changes in equity of a company during a specific period.