Variable CostingProduction Exceeds Sales

Fixed manufacturing costs are $48 per unit, and variable manufacturing costs are $144 per unit. Production was 120,000 units, while sales were 115,200 units.

a. Determine whether variable costing income from operations is less than or greater than absorption costing income from operations.

Choose one:

Variable costing income from operations is greater than absorption costing.

Variable costing income from operations is less than absorption costing.

b. Determine the difference in variable costing and absorption costing income from operations. $