The Budget Policy That Requires Revenues to Equal Expenditures Each

question 47

Multiple Choice

The budget policy that requires revenues to equal expenditures each and every year is called

• A) an annually balanced budget.
• B) functional finance.
• C) a full-employment budget.
• D) a conflict resolution budget.
• E) a budget balanced over the course of the business cycle.

Grasp the process of taking discounts on purchases and their effect on financial accounts.

Differentiate between F.O.B. shipping point and F.O.B. destination.

Calculate and record the effect of freight charges on merchandise purchases.

Explain the role and importance of subsidiary ledgers and control accounts in accounting.

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Definitions:

Direct Materials Inventory

The total cost of raw materials that are directly involved in the manufacturing of a product and are currently held in inventory.

Labour Rate Variance

A financial metric that measures the difference between the actual cost of labor and the expected (or standard) cost.

Labour Efficiency Variance

Labour efficiency variance is the difference between the actual hours worked and the standard hours expected, multiplied by the standard labor rate, used to assess workforce performance.

Standard Labour Rate

A predetermined rate of pay established for work performed, used in budgeting and costing calculations.