If 800 units are produced and 1,200 units are sold, the costing method which will result in the greatest operating income is ________.
A) throughput costing
B) variable costing
C) absorption costing
D) period costing

Question

Quizplus · Accepted Answer

Throughput costing only considers direct material costs as product costs, leading to higher operating income when inventory decreases, as in this case.

If 800 Units Are Produced and 1,200 Units Are Sold