Multiple choice

Directions: Choose the correct option for the given question.

There will be _____ in marginal costing, when there is production but no sales.

  1. profit

  2. loss

  3. cost

  4. income

  5. expense
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

In marginal costing, fixed costs are treated as period costs. If there is production but no sales, there is no contribution to cover the fixed costs, resulting in a loss equal to the fixed costs incurred.

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