Better Products Inc

question 10

Multiple Choice

Better Products Inc. planned to use $36 of material per unit but actually used $34 of material per unit, and planned to make 1,520 units but actually made 1,310 units.
The flexible-budget variance for materials is ________.

• A) $3,040 favorable
• B) $3,040 unfavorable
• C) $2,620 unfavorable
• D) $2,620 favorable

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Definitions:

Construction Costs

Expenses incurred during the process of building structures, infrastructure, or other significant physical assets, including materials, labor, and overhead.

Service Cost

The expense recognized by an employer for the portion of an employee's pension or post-retirement plan earned during the year.

Long-Term Service

Services provided over an extended period, often relating to contracts or employment agreements that require commitment beyond a single fiscal year.

Initial Direct Costs

Expenses that are directly associated with acquiring or starting a lease and are often included in the measurement of the lease asset.