Match the Variance to the Correct Definition

question 93

Multiple Choice

Match the variance to the correct definition.
-Flexible budget variance

• A)measures how well the business uses its materials or human resources
• B)the difference between the expected results in the flexible budget for the actual units sold and the static budget
• C)the difference between actual results and expected results in the flexible budget for the actual units sold
• D)measures how well the business keeps unit material and labor costs within standards
• E)the difference between actual results and the expected results in the static budget

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Definitions:

Transferability

The ability of an asset or property right to be sold or otherwise transferred from one party to another.

Watered Stock

Shares issued by a company at a value much greater than its asset worth, inflating its apparent value without actual backing.

Fair Market Value

An estimate of the market value of a property, based on what a knowledgeable, willing, and unpressured buyer would likely pay to a knowledgeable, willing, and unpressured seller in the market.

Business Judgment Rule

A legal principle protecting corporate directors and officers from liability for decisions made in good faith and in the best interest of the company.