When units produced exceed units sold, how does operating income differ between variable costing and absorption costing? Assume no beginning Finished Goods Inventory. Explain your answer.
What will be an ideal response?
When units produced exceed units sold, the operating income will be higher under absorption
costing than variable costing. With absorption costing, some of the fixed manufacturing overhead costs
absorbed in the product cost are still in ending Finished Goods Inventory and are on the balance sheet.
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Current GAAP requires a company to disclose the fair value of its financial instruments and to disclose all significant concentrations of credit risk due to its financial instruments. The FASB's rationale for this disclosure includes allowing readers to
A) better identify major customers. B) compute each company's risk. C) better determine a company's financial flexibility. D) compute liquidity ratios.
What is a value delivery network?
What will be an ideal response?
Good service recovery can turn angry customers into loyal ones
Indicate whether the statement is true or false
Which of the following is false regarding a merchandising firm?
a. A merchandising firm purchases inventory for resale. b. A merchandising firm does not change the physical form of the inventory. c. A merchandising firm performs no incremental work on the inventory. d. A merchandising firm adds nothing to the acquisition cost of the inventory after it is purchased. e. None of the above are false regarding a merchandising firm.