Which of the Following Describes One of the Causes of Management

question 11

Multiple Choice

Which of the following describes one of the causes of management bias?

• A)The need to comply with contracts, such as debt covenants.
• B)The desire to meet financial analyst's expectations.
• C)The tendency to emphasize positive events only.
• D)All of these

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Definitions:

Actual Costs

The real costs incurred in the production, acquisition, or other activities of a business, as opposed to estimated or budgeted costs.

Standard Costs

An accounting practice where predetermined costs are used for calculating the cost of production, often for budgeting and performance evaluation purposes.

Direct Materials Quantity Variance

The difference between the actual quantity of materials used in production and the standard amount expected to be used, multiplied by the standard cost per unit of material.

Actual Costs

Expenditures that a company incurs, as opposed to estimations or budgeted amounts.