For a period during which the quantity of inventory at the end was larger than that at the beginning,income from operations reported under variable costing will be smaller than income from operations reported under absorption costing.

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Under variable costing, fixed manufacturing costs are treated as period expenses and are not included in the cost of goods sold. Therefore, if ending inventory is larger than beginning inventory, more fixed manufacturing costs will be deferred to the next period, causing income from operations to be lower under variable costing compared to absorption costing.

For a Period During Which the Quantity of Inventory at the End