Which of the following conditions would cause absorption-costing income to be lower than variable-costing income?
A)Units sold exceeded units produced.
B)Units sold equaled units produced.
C)Units sold were less than units produced.
D)Sales prices decreaseD.
E)Selling expenses increased.

Question

Quizplus · Accepted Answer

When units sold exceed units produced, inventory levels decrease, leading to lower fixed manufacturing costs deferred in inventory under absorption costing, resulting in lower income compared to variable costing.

Which of the Following Conditions Would Cause Absorption-Costing Income to Be