Feldspar, Inc. started the year with 200 units in the Finished Goods Inventory account. It produced 600 units during the year and sold 800 units. If Feldspar uses variable costing, ________. A. its operating income will be the same as under absorption costing B. its operating income for the period will be lower than under absorption costing C. its operating income for the period will be higher than under absorption costing D. its value of ending Finished Goods Inventory reported in the balance sheet will be higher than under absorption costing
Feldspar, Inc. started the year with 200 units in the Finished Goods Inventory account. It produced 600 units during the year and sold 800 units. If Feldspar uses variable costing, ________. A. its operating income will be the same as under absorption costing B. its operating income for the period will be lower than under absorption costing C. its operating income for the period will be higher than under absorption costing D. its value of ending Finished Goods Inventory reported in the balance sheet will be higher than under absorption costing
Chapter6: Activity-based, Variable, And Absorption Costing
Section: Chapter Questions
Problem 19MC: When the number of units in ending inventory increases through the year, which of the following is...
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Feldspar, Inc. started the year with 200 units in the Finished Goods Inventory account. It produced 600 units during the year and sold 800 units. If Feldspar uses variable costing, ________.
its operating income will be the same as under absorption costing
its operating income for the period will be lower than under absorption costing
its operating income for the period will be higher than under absorption costing
its value of ending Finished Goods Inventory reported in the balance sheet will be higher than under absorption costing
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