Which of the following statements is True?
A) Operating income under variable costing equals contribution margin less operating expenses
B) When sales exceed production, absorption costing income will be higher than variable costing income
C) Throughput costing assigns all variable costs to cost of goods sold
D) When production exceeds sales, absorption costing income will be higher than variable costing income

Question

Quizplus · Accepted Answer

When production exceeds sales, absorption costing income will be higher than variable costing income because fixed manufacturing overhead costs are spread over more units, reducing the cost per unit and increasing income under absorption costing.

Which of the Following Statements Is True