The level of inventory of a manufactured product increases by 8,000 units during a period. The following data are also available:
Variable Fixed
Unit manufacturing costs during the period $24.00 $10.00
Unit operating expenses during the period 8.00 3.00
What would be the effect on income from operations if variable costing is used rather than absorption costing?
a. $104,000 decrease
b. $80,000 decrease
c. $104,000 increase
d. $80,000 increase
