Which of the Following Statements Is True

question 195

Multiple Choice

Which of the following statements is true?

• A) Variances are the differences between total actual costs and total standard costs.
• B) When actual costs exceed standard costs the variance is favorable.
• C) An unfavorable variance results when actual costs are decreasing but standards are not changed.
• D) All of the above are true.

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Definitions:

Securities Violations

Illegal activities involving the trading or handling of securities, such as insider trading, fraud, or manipulation of the market.

Due Diligence

A required standard of care that certain professionals, such as accountants, must meet to avoid liability for securities violations.

Financial Statement

A formal record of the financial activities and position of a business, person, or other entity, typically including balance sheet, income statement, and cash flow statement.

Generally Accepted Accounting Principles

The standard framework of guidelines for financial accounting used in any given jurisdiction; commonly abbreviated as GAAP.