One Possible Means of Determining the Difference Between Operating Incomes

Multiple Choice

One possible means of determining the difference between operating incomes for absorption costing and variable costing is by ________.

A) subtracting sales of the previous period from sales of this period
B) subtracting fixed manufacturing overhead in beginning inventory from fixed manufacturing overhead in ending inventory
C) multiplying the number of units produced by the budgeted fixed manufacturing cost rate
D) adding fixed manufacturing costs to the production-volume variance