A Favourable Materials Usage Variance May Be Caused by

question 22

Multiple Choice

A favourable materials usage variance may be caused by

• A)excessive rework.
• B)a special price offered by suppliers.
• C)use of experienced workers.
• D)none of the above.

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Definitions:

Discounted Payback Period

The time required to recoup the cost of an investment while accounting for the time value of money, typically used in capital budgeting to assess profitability.

After-Tax Cash Inflows

The net cash that a business generates after accounting for all taxes.

Required Return

The minimum return an investor expects to achieve on an investment, considering its risk level.

Internal Rate of Return

A financial metric used to gauge the profitability of potential investments.