Multiple Choice
Which of the following formulas can often reconcile the difference between absorption- and variable-costing income?
A) Change in inventory units × predetermined variable-overhead rate per unit.
B) Change in inventory units ÷ predetermined variable-overhead rate per unit.
C) Change in inventory units × predetermined fixed-overhead rate per unit.
D) Change in inventory units ÷ predetermined fixed-overhead rate per unit.
E) (Absorption-costing income − variable-costing income) × fixed-overhead rate per unit.
Correct Answer:
Verified
Correct Answer:
Verified
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