Why Is the Sky Blue During the Day

question 28

Essay

Why is the sky blue during the day?

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Definitions:

Favourable Variance

A financial term referring to a situation where actual costs are less than budgeted costs, or actual revenues exceed budgeted revenues.

Variable Overhead Efficiency Variance

A measure of the difference between the expected variable overhead based on standard costs and the actual variable overhead incurred.

Flexible Budget

A report showing estimates of what revenues and costs should have been, given the actual level of activity for the period.

Manufacturing Overhead

The sum of all costs involved in the production process other than direct materials and labor, such as utilities and rent for the manufacturing facilities.