The Two Basic Reasons for Variance Are

question 19

Multiple Choice

The two basic reasons for variance are

• A)estimates of error and measuring instruments
• B)robustness and power
• C)simple statistics and poor understanding of statistical assumptions
• D)measurement inaccuracy and true differences between measurements

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Definitions:

Expected Activity

Expected Activity refers to the anticipated level of operation or production based on forecasts or historical data.

Actual Activity

A measure of the real amount of work performed or production completed in a specific period.

Activity-based Costing

A costing methodology that assigns costs to products or services based on the activities required to produce them, aiming to more accurately reflect the consumption of resources.

Manufacturing Overhead

All indirect costs associated with manufacturing, such as utilities, maintenance of equipment, and factory supplies, not directly attributable to specific product units.