In a period in which the number of units produced is exactly equal to the number of units sold, which statement about reported profit is correct (assuming unit costs are unchanged from the previous period)?

Correct answer: C) Absorption costing and marginal costing will report the same profit

Explanation

Differences in profit arise only from the fixed production overhead carried forward in changes in inventory. If production equals sales, inventory does not change, so the fixed overhead charged against profit is the same under both methods and the profits are equal.