There Are Many Causes of Variation in Project Costs

question 46

Multiple Choice

There are many causes of variation in project costs.Which of the following accurately describes the nature of this variation?​ 

• A) Variation is generally greater on projects that use well-known technology and an experienced project team. 
• B) Variation occurs in all work processes and the novelty associated with most projects creates many opportunities for variation. 
• C) Special cause variation comes from many small causes that are inherent in a work process. 
• D) Normal cause variation is when something out of the ordinary occurs

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Definitions:

Raw Materials Inventory

The total cost of all the raw materials that are used in production but have not yet been processed into finished goods.

Raw Materials Purchases

The total cost a company incurs for acquiring the raw materials needed in the production process.

Budgeted Balance Sheet

A projected financial statement showing the expected financial position of a company at a future date, taking into account its assets, liabilities, and equity.

Retained Earnings

Retained earnings are the portion of a company's profits not distributed as dividends to shareholders but reinvested in the business or kept as reserve.