Absorption and Variable Costing

1. A supplier of aircraft parts to an aircraft manufacturer has noticed an increase in inventory. As a result of this, will absorption costing or variable costing income be greater for the supplier? Explain why?

2. You are a management analyst for XYZ aircraft manufacturing company. Your company is considering either to use absorption costing or variable costing for internal financial analysis. Which method would you recommend and why would you recommend it?
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