Figure 7-4
the Following Information Pertains to Stark Ltd -Refer to Figure 7-4

Multiple Choice

Figure 7-4
The following information pertains to Stark Ltd.:
$$\begin{array} { l r } \text { Beginning inventory } & 0 \text { units } \\\text { Ending inventory } & 5,000 \text { units } \\\text { Direct labour per unit } & £ 20 \\\text { Direct materials per unit } & 16 \\\text { Variable overhead per unit } & 4 \\\text { Fixed overhead per unit } & 10 \\\text { Variable selling costs per unit } & 12 \\\text { Fixed selling costs per unit } & 16\end{array}$$
-Refer to Figure 7-4. Absorption costing net income would be ____ the variable costing net income.

A) £50,000 greater than
B) £70,000 greater than
C) £70,000 less than
D) £50,000 less than