Bid-Rigging Is More Likely When

question 35

Multiple Choice

Bid-rigging is more likely when

• A)auctions are larger
• B)auctions are infrequent
• C)auctions generate different sets of potential bidders
• D)the auctioneer is paid a fixed fee rather than on commission

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Definitions:

Direct Materials Purchases Variance

The difference between the actual cost of direct materials purchased and the expected cost, based on standard prices and quantities.

Standard Costs

Predetermined or estimated costs used for budgeting and measuring performance, typically under ideal operating conditions.

Materials Quantity Variance

The difference between the actual quantity of materials used in production and the standard quantity expected to be used, based on budgeted or planned amounts.

Direct Labor-Hours

The total hours worked by employees directly involved in the production process, used as a basis for allocating manufacturing overhead in cost accounting.