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If inventory levels have declines because of the number of units sold is greater than the...

If inventory levels have declines because of the number of units sold is greater than the units manufactured operating income will be higher under absoprtion costing than it is under variable costing. True or False

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Answer #1

False

The statement is incorrect

If the unit sold are more than units produced than the operating income under absorption costing is lower than it it is under variable costing because of Fixed manufacturing expenses under absorption costing charged on number of units sold under absorption costing whereas in case of variable costing only that much is charged what is incurred during the period

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