A Variance Is Calculated to Measure the Difference Between Actual

question 68

Multiple Choice

A variance is calculated to measure the difference between actual costs and:

• A)expected selling price.
• B)expected costs.
• C)activity-based costs.
• D)capacity costs.

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Definitions:

CEO

Chief Executive Officer, the highest-ranking person in a company or organization, responsible for overall management.

Sales Budget

One of the major elements of the income statement budget that indicates the quantity of estimated sales and the expected unit selling price.

Production Budget

A budget of estimated units to be manufactured to meet budgeted sales and desired inventory levels.

Capital Expenditures Budget

A plan for a company’s spending on fixed assets, such as equipment or property, that will be used over a long period.