Accounting · Absorption and Marginal Costing
A company's budgeted production was 10,000 units and budgeted fixed production overheads were $100,000. Actual production was 10,000 units, but actual sales were 9,000 units. If the company uses absorption costing instead of marginal costing, how will the profit be affected?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1$5,000 lower
- 2$5,000 higher
- 3$10,000 lower
- 4$10,000 higher✓
Correct answer
$10,000 higher
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