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When units produced are less than units sold, net income computed under variable costing will be __________________ (greater, less) than net income computed under absorption.

Respuesta :

Answer:

Greater

Explanation:

The main difference between absorption cost and variable costing is Fixed costs. In absorption cost fixed cost is allocated to production and it absorbed in the cost of a department product or service. As production is less than the unit sold then their will be lesser closing inventory and This inventory simply account for the variable cost.

Supporting calculation is attached with this question. Please find it.

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