Which of the Following Statements Should Be Prepared Before the Balance

question 98

Multiple Choice

Which of the following statements should be prepared before the balance sheet is prepared?

• A)statement of owner's equity
• B)statement of financial position
• C)income statement
• D)statement of owner's equity and income statement

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Definitions:

Materials Quantity Variance

The variance between the real amount of materials consumed in the production process and the anticipated standard amount, times the standard unit cost.

Direct Materials Purchases Variance

A measure used in accounting to analyze the difference between the budgeted cost of materials needed for production and the actual cost incurred.

Actual Production

The real quantity of goods or services produced in a specified period, as opposed to planned or expected production levels.

Labor Rate Variance

The difference between the actual labor costs incurred and the standard labor costs expected for the labor hours worked.