A Contractual License to Operate an Individually Owned Business as a Part

question 56

Multiple Choice

A contractual license to operate an individually owned business as a part of a larger chain is known as a/an

• A) Franchise
• B) Small business contract
• C) Chain contract
• D) Import contract

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Definitions:

Direct Materials Price Variance

Direct materials price variance is the difference between the actual cost of direct materials and the standard cost, showing how much more or less was spent on purchasing materials.

Direct Labor Quantity Variance

The difference between the actual hours worked and the standard hours allowed, multiplied by the standard rate, indicating efficiency in labor usage.

Overhead Volume Variance

The difference between the expected (or standard) amount of manufacturing overhead costs given a certain level of production and the actual overhead costs incurred.

Standard Direct Labor Cost

The predefined cost associated with the labor required to produce a good or service, under normal circumstances.