Management may be tempted to overproduce a. when using variable costing, in order to increase net income. b. when using variable costing, in order to decrease net income. c. when using absorption costing, in order to increase net income.

Q: variable

A: Performance evaluation based on income could be best achieved by using variable costing method in…

Q: explain why GAAP requires full absorption costing (instead of variable costing) if absorption…

A: Introduction:- i)Absorption costing:- Under the absorption costing, The following costs included in…

Q: Management is considering a one-time-only special order. There is sufficient idle capacity to fill…

A: Introduction:- Management (or management) is the administration of a company, whether for-profit,…

Q: Operating profit is affected by changes in production under both the variable costing and absorption…

A: Operating profit is profit earned by the company from its primary or core purpose of the business.…

Q: Which of the following is not a potential advantage of variable costing relative to absorption…

A: Variable costing is a method in which only variable cost is considered in product cost. Absorption…

Q: Which of the following is a limitation of activity-based costing? More cost pools Poorer management…

A: Introduction: ABC costing also called as Activity based costing. According to the consumption cost…

Q: Under variable costing, how is it possible to increase net operating income without increasing sales

A: Introduction:- Under the Variable costing includes only variable manufacturing costs such as  direct…

Q: Gross margin is to absorption costing as which of the following is too variable costing?   A.…

A: Variable costing uses Contribution Margin Income Statement by showing Sales – VARIABLE expenses =…

Q: TRUE OR FALSE When absorption costing is used, management may be tempted to overproduce in each…

A: Under the absorption costing method, fixed overhead is considered as a product cost which is…

Q: o decide whether to accept or reject special order, the manager should ensure that the order is…

A: Solution: Special order is the order which is in addition to normal sales to customers. The…

Q: Identify if true or false   When inventory decreases, the net operating income under absorption…

A: Costing is a process under which the information about the costs incurred by the business unit is…

Q: When units produced exceeds units sold, a. net income under absorption costing is higher than net…

A: If units produced > units sold There will be ending inventory. Some part of the fixed factory…

Q: The objective of management, under absorption costing, is that each product recovers its full cost…

A: Absorption costing is the method used by the managers to determine the cost connected with the…

Q: Which of the following statements is false ? a. Volume-based costing has typically resulted in…

A: There are two methods of costing that are in place generally. One is volume based costing and other…

Q: When comparing absorption costing to variable costing, all of the below are disadvantages of…

A: Solution: When comparing absorption costing to variable costing, all of the below are disadvantages…

Q: Which one of the following is not correct about variable costing systems? Select one: O a. Focuses…

A: Variable costing: Under this method refers to the cost technique under which only variable costs are…

Q: How lean production eliminate the difference between absorption and variable costing

A: Following is the answer to the given question

Q: In target​ costing, prices determine costs rather than vice​ versa." Explain.       Question content…

A: Target costing involves the calculation of an allowable product cost to earn a predetermined amount…

Q: Why is variable costing not in compliance with generally accepted accounting principles? a. Fixed…

A: The generally accepted accounting principles are following the absorption method for the valuation…

Q: Managers often assume a strictly linear relationship between cost and volume. How can thispractice…

A: Cost:   Cost can be defined as the cash and cash equivalent which is incurred against the products…

Q: When comparing absorption costing with variable costing, which of the following statements is not…

A: Absorption costing is that method of costing, in which all total costs (fixed and variable) are…

Q: Under variable costing a. Net income will tend to vary inversely with production changes b. Net…

A: DM=Direct materials OHD=Overhead   Step 1   Variable costing is a method that only allocates…

Q: Which of the following is an advantage of using variable costing? *     a. Variable costing complies…

A: Variable costing distinct feature and advantage is that it enable to establish the cost volume…

Q: When a traditional, volume-based costing system is used, which of the following products is most…

A: Accounting:   Accounting is the art of recording, classifying and summarizing in a significant…

Q: plain how the cost per equivalent unit might be misleading to managers, particularly when a…

A: The term "equivalent units of production" refers to the work-in-process inventory at the end of the…

Q: Do you agree with the following statements? Check only those with which you agree. Check All That…

A: Variable Costing refers to those costs which are directly related to the production and changes with…

Q: Give an example of how, under absorption costing, operating income could fall even though the unit…

A: Definition:   Absorption Costing: The absorption costing is a method used to allocate the fixed…

Q: Product costs under variable costing are typically: Group of answer choices A. higher than under…

A:

Q: Relevant of differential cost analysis takes all variable and fixed costs into account to analyze…

A: Differential cost analysis is the difference in cost for every alternative which helps in making the…

Q: What is the basic difference between variable costing and absorption costing? a. Variable costing…

A: Absorption costing: Absorption costing is also called traditional costing. This method of costing…

Q: Marginal costing is usually deployed when decisions about volume are being made. Discuss the…

A: Monetary Accounting has appeared with the advancement of huge scope business   as business entities.…

Q: When making decisions, managers should consider a. revenues that differ between alternatives. b.…

A: The explanation for the given options:   a. A manager on the verge of making decisions must consider…

Q: A basic belief of variable costing is that period costs should be currently expensed. What is the…

A: A variable cost is one of the important method related to costing. Basically it is a expense of a…

Q: Why do product-costing systems based on a single, volume-based cost driver tend to over-cost…

A: Single volume-based cost driver means the basis of allocation of costs to particular products using…

Q: Which among the following is not true about traditional costing system? a. This method allocates…

A: Traditional costing is allocating the factory overhead to products based on the volume of the…

Q: Which of the following statements is not true regarding the use of variable and absorption costing…

A: Answer:   Option d.

Q: Marginal costing is a technique that distinguishes between variable costs and fixed costs. In this…

A: Cost-volume-profit (CVP) analysis is an important and systematic method that provides useful…

Q: Which of the following statements is true?   a. When production is greater than sales, operating…

A: The question is based on the concept of Cost Accounting.

Q: Which of the following is not a potential advantage of variable costing relative absorption costing?…

A: Cost volume profit analysis is calculated by dividing the fixed cost by the unit contribution…

Q: TRUE OR FALSE Net income under variable costing is closely tied to changes in sales levels.

A: Fixed cost remains same under the variable costing. No matter how much units are produced, the total…

Q: T, F. In a make or buy short-run decision situation, the critical element to consider is whether the…

A: As posted multiple independent questions we are answering only first question kindly repost the…

Q: Net operating income fluctuates directly with changes in sales volume.       Fixed production and…

A: Answer:- correct option is  Unit product costs can change as a result of changes in the number of…

Q: Critics of absorption costing have increasingly emphasized its potential for leading to undesirable…

A: Absorption Costing: The absorption costing is a method used to allocate the fixed manufacturing…

Q: Briefly discuss two methods of reducing the undesirable incentives associated with the use of…

A: Use of absorption costing can lead to undesirable incentives when evaluating the performance of a…

Q: T, F. In a make or buy short-run decision situation, the critical element to consider is whether the…

A: Variable cost is that cost that varies with the number of units produced. It means that increase in…

Q: Which of the followings is not correct about cost-based pricing? Select one: a. Total fixed costs…

A: Cost based pricing is the method to set selling price based on the cost. To get selling price,…

Q: Accepting a special order will improve overall net operating income if the revenue from the special…

A: Variable costs are the costs which change with change in output. Sunk costs are the costs which are…

Q: Briefly explain the potential negative consequences in pricing decisions from using a traditional,…

A:

Q: Which of the following statements is not false of costing​ systems?   A. ​Activity-based costing…

A: Introduction: Traditional costing is the more simplest method which typically delivers less accuracy…