1When units produced are less than units sold income under a

1.When units produced are less than units sold, income under absorption costing is higher than income under variable costing.

a.True

b.False

2.When there are zero units in Beginning Finished Goods Inventory and the units produced are more than the units sold, the income will be lower under variable costing than under absorption costing.

a.True

b.False

3.Standard costs can be used by management to assess the reasonableness of actual costs incurred.

a.True

b.False

Solution

Dear student, only one question is allowed at a time. I am answering the first question

Under absorption costing, Fixed costs form part of cost of the Inventory and so if there is ending Inventory left during a year, the value of Inventory under absorption costing will be higher than value of Inventory under variable costing and so Income under absorption costing will be higher than under variable costing

So, the above statement is True