The Activity Index Used in Preparing the Flexible Budget

question 55

Multiple Choice

The activity index used in preparing the flexible budget

• A) is prescribed by generally accepted accounting principles.
• B) is only applicable to fixed manufacturing costs.
• C) is the same for all departments.
• D) should significantly influence the costs that are being budgeted.

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Definitions:

Conditioned Stimulus

A previously neutral stimulus that, after becoming associated with an unconditioned stimulus, eventually triggers a conditioned response.

Unconditioned Stimulus

A stimulus that naturally and automatically triggers a response without the need for prior learning.

Conditioned Response

A learned reaction to a specific stimulus as a result of consistent pairing with another stimulus.

Systematic Desensitization

A behavioral therapy technique used to reduce anxiety or fear through gradual exposure to the feared object or situation paired with relaxation exercises.