If the Total Materials Variance for a Given Operation Is

question 13

Multiple Choice

If the total materials variance for a given operation is favorable, why must this variance be further evaluated as to price and usage?

• A) There is no need to further evaluate the total materials variance if it is favorable.
• B) Generally accepted accounting principles require that all variances be analyzed in three stages.
• C) All variances must appear in the annual report to equity owners for proper disclosure.
• D) A further evaluation lets management evaluate the activities of the purchasing and production functions.

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Definitions:

Task Behavior

The actions and activities an individual undertakes to achieve a specific objective.

Relationship Behavior

Actions and interactions that define the nature of relationships between individuals or groups.

Subordinates

Employees or team members who are ranked lower within an organization's hierarchy and report to a supervisor or manager.

Initiating Structure

A leadership behavior that involves setting up clear roles, tasks, and goals, and organizing work processes to achieve objectives.