Under variable costing, if a manager’s bonus is tied to operating income, then increasing inventory levels compared to last year would result in

ACCOUNTING

Multiple Choice

Under variable costing, if a manager’s bonus is tied to operating income, then increasing inventory levels compared to last year would result in

a. increasing the manager’s bonus.

b. decreasing the manager’s bonus.

c. not affecting the manager’s bonus.

d. being unable to determine the manager’s bonus using only the above information

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