If a Company Produces More Units Than It Sells in a Period

Multiple Choice

If a company produces more units than it sells in a period, net operating income under variable costing will:

A) Be the same as it would be under absorption costing
B) Be less than it would be under absorption costing
C) Be equal to the net operating income using absorption costing plus selling and administrative costs
D) Be equal to the net operating income using absorption costing less fixed manufacturing costs