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