Silver Corporation produces a single product. During the current year, Silver produced 30,000 units and sold 24,000 units. There were no units in beginning inventory. Silver's total variable manufacturing costs were $75,000 and its total fixed manufacturing overhead costs were $45,000. Which of the following statements is true? O Under variable costing, the cost of the items in ending inventory is $4.00 per unit. O Operating income computed using absorption costing is $9,000 lower than operating income computed using variable costing. O Under absorption costing, the cost of the items in ending inventory is $2.50 per unit. O Ending inventory computed using variable costing is $9,000 lower than ending inventory computed using absorption costing. O None of the above statements is true.

Silver Corporation produces a single product. During the current year, Silver produced 30,000 units and sold 24,000 units. There were no units in beginning inventory. Silver's total variable manufacturing costs were $75,000 and its total fixed manufacturing overhead costs were $45,000. Which of the following statements is true? O Under variable costing, the cost of the items in ending inventory is $4.00 per unit. O Operating income computed using absorption costing is $9,000 lower than operating income computed using variable costing. O Under absorption costing, the cost of the items in ending inventory is $2.50 per unit. O Ending inventory computed using variable costing is $9,000 lower than ending inventory computed using absorption costing. O None of the above statements is true.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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