Which of the following is not a potential advantage of variable costing relative absorption costing? a. Net income computed under variable costing is unaffected by changes production levels. b. It is easier to understand the impact of fixed and variable costs on computation of net income when variable costing is used. c. The use of variable costing is consistent with cost-volume-profit analysis. d. Net income computed under variable costing is not closely tied to changes in sales level.
Which of the following is not a potential advantage of variable costing relative absorption costing? a. Net income computed under variable costing is unaffected by changes production levels. b. It is easier to understand the impact of fixed and variable costs on computation of net income when variable costing is used. c. The use of variable costing is consistent with cost-volume-profit analysis. d. Net income computed under variable costing is not closely tied to changes in sales level.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Which of the following is not a potential advantage of variable costing relative absorption
costing?
a. Net income computed under variable costing is unaffected by changes production
levels.
b. It is easier to understand the impact of fixed and variable costs on computation of net
income when variable costing is used.
c. The use of variable costing is consistent with cost-volume-profit analysis.
d. Net income computed under variable costing is not closely tied to changes in sales level.
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