Rebel Company manufactures a single product and has the following cost structure:
|
Variable costs per unit: |
|
|
Production |
$5 |
|
Selling and administrative |
$3 |
|
Fixed costs in total: |
|
|
Production |
$32,000 |
|
Selling and administrative |
$16,000 |
Last year there were no beginning inventories, 8,000 units were produced, and 7,800 units were sold.
The carrying value on the balance sheet of the ending inventory under variable costing would be:
A) $1,400 higher than under absorption costing.
B) $1,400 less than under absorption costing.
C) $800 less than under absorption costing.
D) the same as under absorption costing.