Figure 18-1
Froelech Company Has Developed Capacity Standards -Refer to Figure 18-1

question 10

Multiple Choice

Figure 18-1
Froelech Company has developed capacity standards. Information is as follows: $\begin{array}{lr}\text { Standard cost of the activity capacity acquired } & £ 150,000 \\\text { Standard cost of the activity capacity used } & 100,000 \\\text { Standard cost of the actual activity used } & 120,000\end{array}$
-Refer to Figure 18-1. The volume variance is

• A)£20,000 unfavourable.
• B)£30,000 unfavourable.
• C)£50,000 unfavourable.
• D)There is no variance.

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Definitions:

GMAC Purchase Finance

Financial services related to buying, typically provided by General Motors Acceptance Corporation, focusing on auto loans and leases.

Cash Purchase Price

The amount of money required to buy a good, service, or asset without financing or credit.

Effective Interest Rate

The actual return on an investment or the real cost of borrowing, accounting for the effect of compounding interest.

Compounded Monthly

The calculation of interest on the principal amount where the interest accrued is added to the principal every month, allowing for the accumulation of interest on interest.