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Problem 1: Volplex, Inc. produces paper and office supplies and uses the just-in-time inventory system. Currently, the company is using variable costing. Which of the following is true of the effect of costing systems on the financial results of Volplex?
Option 1: Its operating income will be significantly higher if the company uses absorption costing instead of variable costing.
Option 2: Its operating income will vary a little if the company uses absorption costing instead of variable costing.
Option 3: Its operating income will be significantly lower if the company uses absorption costing instead of variable costing.
Option 4: Its operating income will be negative if the company uses absorption costing instead of variable costing.
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