Answer:
Income using absorption costing =$300.,000
Explanation:
The difference between the profits under the two costing systems is the manner in which inventory is valued.
Absorption costing profit = Variable costing profit +/- difference in profit
Difference in profit = OAR × change in inventory
Change in inventory = opening inventory - closing inventory
Hence for this question,
Opening inventory = 800 +500= 1,300 units
Closing inventory = 800 +500= 1,300 units
change in inventory = 0
Difference in profit = 8.00 × 0= $0
Income using Absorption costing is equal to =
Income using variable costing - difference in profit
= 176,000 $ + 109,000 + $ 115,000 - $0
=$300,000
