Multiple Choice
Bella Ltd has operated for 2 years. During that time it produced 1,000 units in year 1 and 800 in year 2, while sales were 800 units in year 1 and 900 in year 2. Variable production costs were $8 per unit during both years. The company uses last-in, first-out (LIFO) for inventory costing. The absorption costing income statements for these 2 years were: Operating profit for year 1 using variable costing would be
A) $1,600
B) $(2,800)
C) $2,200
D) $400
Correct Answer:
Verified
Correct Answer:
Verified
Q88: Variable costing income statements include fixed manufacturing
Q89: Normal capacity and budgeted capacity are demand-based
Q90: Taylor Ltd just finished its second year
Q91: In variable costing<br>A) Only variable production costs
Q92: Absorption costing<br>A) Is used for external reporting
Q94: Throughput costing assumes that product costs other
Q95: Taylor Ltd just finished its second year
Q96: General Ltd. budgeted fixed overhead costs of
Q97: Under generally accepted accounting principles, absorption costing
Q98: Direct materials costs are treated similarly under