Accounting 9706 · AS & A Level · Costs and cost behaviour

Costs and cost behaviour — practice question

A company manufactures less than it sells during a given period. Which statement is correct?

  • AReported profit is the same whether absorption or marginal costing is used.
  • BReported profit is the difference between absorption and marginal costing closing inventories.
  • CReported profit is lower using absorption costing.
  • DReported profit is lower using marginal costing.

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