Answer the Following Question(s)using the Information Below

Multiple Choice

Answer the following question(s) using the information below.Heinrich Corporation budgeted fixed manufacturing costs of $6,000 during 2012.Other information for 2012 includes:
The company uses absorption costing and the fixed manufacturing cost rate is based on the budgeted denominator level.Manufacturing variances are closed to cost of goods sold.
-Which of the following is a weakness particular to the absorption costing method?

A) A production manager cannot manipulate operating income.
B) A manager is always encouraged to match the production schedule to estimated demand.
C) A manager may be encouraged to switch production to difficult to manufacture products.
D) A downward demand spiral can be created.
E) A manager may be encouraged to defer maintenance.