At the End of the Accounting Period Bumsted Corporation Reports

Multiple Choice

At the end of the accounting period Bumsted Corporation reports operating income of $30,000. If Bumstead's inventory levels decrease during the accounting period

A) variable costing will report less operating income than absorption costing.
B) absorption costing will report less operating income than variable costing.
C) variable costing and absorption costing will report the same operating income.
D) None of the above are correct.