When there is no beginning inventory and all the goods that are produced are sold,the operating income ________.
A)will be higher under absorption costing than variable costing
B)will be lower under absorption costing than variable costing
C)will be higher than the gross profit under variable costing
D)will be the same for both absorption costing and variable costing

Question

Quizplus · Accepted Answer

When there is no beginning inventory and all produced goods are sold, operating income will be the same under both absorption and variable costing because there are no inventory changes to affect the allocation of fixed manufacturing costs.

When There Is No Beginning Inventory and All the Goods