When inventory decreases, cost of goods sold under absorption costing will be more than the cost of goods sold under variable costing. Therefore, the option B holds true.
<h3>What is the significance of cost of goods sold?</h3>
The cost of goods sold can be referred to or considered as the costs derived by a company to lead the sales of the desired quantity. Such costs are generally more in case of variable costing than in absorption costing of the goods being sold by the producer in the market.
Therefore, the option B holds true and states regarding the significance of cost of goods sold.
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The question seems to be incomplete. It has been added for better reference.
When inventory decreases, cost of goods sold under absorption costing will generally be _________ the cost of goods sold under variable costing.
A. Less than
B. More than
C. Equal to
D. None of the above