Which of the Following Statements Is Not True Regarding the Fixed

question 47

Multiple Choice

Which of the following statements is not true regarding the fixed production cost variance?

• A) The fixed production cost variance is the difference between actual and budgeted costs.
• B) With respect to this variance, fixed costs are affected by activity levels within a relevant range.
• C) The flexible budget's fixed costs equal the master budget's fixed costs.
• D) Fixed costs are treated as period costs for purposes of this variance.

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Definitions:

Company Books

Official records maintained by a business documenting its financial transactions and activities.

Outstanding Checks

Checks that have been issued and recorded in a company's financial records but have not yet been cashed or cleared by the bank.

NSF

An acronym for "Non-Sufficient Funds," indicating that a check cannot be processed due to insufficient money in the account.

Bank Reconciliation

The process of comparing and adjusting a company's financial records to match the transactions recorded by the bank, ensuring accuracy in the accounts.