calculated as the change in the number of units in inventory multiplied by the fixed overhead Circle the single best answer. 9. Variable costing may be used for internal or external reporting: (a) true; (b) false 10. When using absorption costing, all manufacturing costs (direct materials, direct labour, variable overhead, and fixed overhead) are considered product costs: (a) true; (b) false 11. The income statement used for variable costing usually classifies costs by function (manufac- turing costs vs. selling and administrative costs): (a) true; (b) false 12. Contribution margin equals sales minus variable manufacturing costs: (a) true; (b) false 13. When sales equal production, net income is the same under the two methods: (a) true; (b) false 14. When sales exceed production, absorption-costing income will generally exceed variable- costing income: (a) true; (b) false 15. The difference between absorption-costing income and variable-costing income can be rate per unit (assuming the FOH rate remains unchanged): (a) true; (b) false 16. The segment margin provides information useful in assessing the long-ruri profitability of a segment: (a) true; (b) false Use the following information to answer Questions 17 through 24