Reference no: EM132607842

The following data pertain to one month's operations of Whitney, Inc.:

Units in beginning inventory       0

Units produced                    9,000

Units sold                            8,000

Variable costs per unit:

Manufacturing                         $10

Selling and administrative            $6

Fixed costs in total Manufacturing $18,000

Selling and administrative                 $27,000

Problem 1: For the month noted, what was the relationship between the operating income under variable costing as opposed to under absorption costing?

A) Higher than operating income under absorption costing.

B) Lower than operating income under absorption costing.

C) The same as operating income under absorption costing.

D) The relationship between variable costing and absorption costing operating income cannot be determined with the data provided.