Question
(e) The net operating income (loss) under absorption costing is less than the net operating income (loss) under variable costing in Year 2 because: (You
(e) The net operating income (loss) under absorption costing is less than the net operating income (loss) under variable costing in Year 2 because:
(You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.)
a. Units were left over from the previous year
b. The cost of goods sold is always less under variable costing than under absorption costing
c. Sales exceeded production so some of the fixed manufacturing overhead of the period was released from inventories under absorption costing.
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