Direction: True or False. Explain why. 1.Absorption costing income is always greater than variable costing income 2.Unavoidable fixed costs are considered to be relevant costs 3.Managers who are considering whether to sell or process further a product should only consider incremental revenues of processing further 4. All Variable costs are relevant costs

Direction: choose the best answer

9.Under what scenario will the absorption costing income be greater than the variable costing net income A.Production < Sales B.Cannot be determined C.Production = Sales D.Sales > Production

10. A special order was received by Mr. Arturtio the manager. The relevant costs of accepting the special order are as follows, except (assuming the production capacity is full): A.Salaries that will be incurred whether accepted or not B.Fixed costs savings C.The special price D.The contribution margin of the halted production

11. The minimum acceptable price of accepting an outsourcing decision is the total of: A.Direct fixed costs and variable costs B.Out-of-pocket costs, cost savings and opportunity costs C.Avoidable costs only D.Direct fixed costs, variable costs and cost savings