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44) than variable costing Assume zero beginning inventories. Which of the following gives the correct reason for the above statement? 44) When production is more than sales, the operating income will be higher under absorption costing A) all costs incurred have been recorded as expenses B) flxed manufacturing costs have not been considered while cakculating the operating profits C) a portion of the fixed manufacturing overhead is still in the ending Finished Goods Inventory account D) all selling and administrative expenses have been recorded as period costs 45) 45) Nimtrans Inc. reports the following information for August $800,000 Sale revenue Variable cost of goods sold Fixed cost of goods sold Variable selling and administrative costs Fixed selling and administrative costs75.000 200,000 100,000TR 150,000 Calculate the gross profit for August using absorption costing? ) $725,000 D) $500,000 B) $600,000 A) $650,000 46) 46) Groovelex Inc has collected the following data for the current year 50 units 450 units 500 units Beginning inventory Units produced Units sold Sale price Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative costs $120 per unit $25 per unit $12 per unit $13 per unit $15.750 per year $6 per unit Fixed selling and administrative costs $12,500 per year The beginning inventory costs $3.750 under absorption costing and $2.500 under variable costing What is the operating income using absorption costing? C) $3,750 D) $4,750 A) $2,500 B)$3,950 7) Which of the following statements is true of the behavior of total fixed costs, within the relevant47) A) They will decrease as production decreases B) They will decrease as production increases C) They will increase as production decreases D) They will remain the same as production levels change 48) Porterhouse Company incurs both fixed and variable production costs. Assuming the production is 48) within the relevant range, if volume goes up by 20%, then the total fixed costs would A) remain the same C) decrease by 20% B) increase by an amount less than 20% D) increase by 20%