Which of the Following Is Not a Reason That Actual

question 2

Multiple Choice

Which of the following is not a reason that actual direct labor costs may differ from the flexible budget amounts?

• A)The purchasing manager resigned and a higher-paid replacement was hired.
• B)After the company set the standard wage rate, the union reached an agreement that required a pay raise for all factory workers.
• C)Because the air conditioner in the factory was not working properly, workers did not work as efficiently as expected in the hot afternoons.
• D)Unanticipated breakdowns in factory machinery increased production time.

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Definitions:

Expenses

Costs incurred in the process of earning revenue, including operational costs like rent, utilities, and payroll.

Withdrawals

Refers to the act of taking money out of a bank account or the removal of funds from a business by its owner for personal use.

Accounts Payable

The amount of money a company owes to its suppliers or vendors for goods or services received but not yet paid for.

Unearned Revenue

Money received by a company for goods or services yet to be delivered or performed, recognized as a liability on the balance sheet.