Assuming no units in the beginning inventory

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Reference no: EM13753163

Clayton Company produces a single product. Last year, the company's variable production costs totaled $8,000 and its fixed manufacturing overhead costs totaled $4,800. The company produced 4,000 units during the year and sold 3,600 units. Assuming no units in the beginning inventory:

A) Under variable costing, the units in ending inventory will be costed at $3.20 each.

B) The net operating income under absorption costing for the year will be $480 lower than net operating income under variable costing.

C) The ending inventory under variable costing will be $480 lower than the ending inventory under absorption costing.

D) The net operating income under absorption costing for the year will be $800 lower than net operating income under variable costing.

Reference no: EM13753163

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