First: When the number of units in inventories decrease between the beginning and end of the period, absorption costing net operating income will typically be greater than variable costing net operating income. Second: When viewed over the long term, accumulated net operating income will be the same for variable and absorption costing if there are no ending inventories at the end of the term. * a. Both statements are true b. Only the first statement is true c. Only the second statement is true d. Both statements are false

First: When the number of units in inventories decrease between the beginning and end of the period, absorption costing net operating income will typically be greater than variable costing net operating income. Second: When viewed over the long term, accumulated net operating income will be the same for variable and absorption costing if there are no ending inventories at the end of the term. * a. Both statements are true b. Only the first statement is true c. Only the second statement is true d. Both statements are false

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter6: Activity-based, Variable, And Absorption Costing

Section: Chapter Questions

Problem 19MC: When the number of units in ending inventory increases through the year, which of the following is...

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