26. Under variable costing, producing more units than the number of units sold i

Question

26. Under variable costing, producing more units than the number of units sold in a period will:
A. cause net operating income for the period to decrease
B. cause net operating income for the period to increase
C. have no effect on net operating income for the period

27. Which costs are the most relevant in deciding between two alternatives?

A. Future costs that differ

B. Future costs that do not differ

C. Historical costs



28. In decision making, it is probably safe to say that costs which are based as "allocated" are:

A. Irrilevant

B. Relevant

C. Sunk



29. The heading of the statement of cash flows should specify:

A. a period of time

B. a point in time

C. neither a peiod nor a point in time

Explanation / Answer

26) A - Net operating income would decrease because we are producing more than we sell. This means we have more expenses than revenue. 27) (I'm not completely sure on this one) I am thinking that future costs that differ are most relevant when deciding between two alternatives because there are different possibilities for the future. - A (or it could be C) 28) B - Relevant cost http://www.investopedia.com/terms/i/irrelevantcost.asp http://www.investopedia.com/terms/r/relevantcost.asp http://www.investopedia.com/terms/s/sunkcost.asp 29) A - the heading will include the company name most likely as well as the "Cash Flows Statement" and a line that says "The Year ending on"

Related Questions

Navigate

• Browse (All)
• Browse 2
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.