Assuming the Number of Units Sold and Produced Are the Same

Multiple Choice

Assuming the number of units sold and produced are the same, which of the following statements is true when comparing net operating income using absorption and variable costing?

A) Absorption costing will yield a higher net operating income.
B) Variable costing will yield a higher net operating income.
C) Net operating income will be the same under both methods.
D) Variable costing will have higher sales revenue.