1)

In absorption costing, sales revenue less cost of goods sold is equal to ______.

A) contribution margin

B) operating margin

C) operating income

D) gross margin

2)

When the actual volume of production exceeds the expected volume of production, the production volume variance is ______ and fixed overhead is ______.

A) favorable; underapplied

B) favorable; overapplied

C) unfavorable; underapplied

D) unfavorable; overapplied

3)

Underapplied and overapplied fixed overhead has two components that include a production- volume variance and a fixed overhead flexible budget varience.

A) TRUE

B) FALSE

4)

The variable-costing income statement separates costs into fixed costs and variable costs.

A) TRUE

B) FALSE