Which of the Following Categories Would Be Least Likely to Require

question 123

Multiple Choice

Which of the following categories would be least likely to require annual adjustments in a capital budgeting analysis due to the effects of inflation?

• A)sales
• B)expenses
• C)working capital
• D)depreciation expense

---

Definitions:

Direct Material Price Variance

Direct material price variance is the difference between the actual cost of materials used in production and the expected (or standard) cost, indicating how effectively a company manages its resource costs.

Actual Production

Refers to the quantity of goods that have been produced within a given time frame, as opposed to planned or theoretical production levels.

Direct Labour Variance

The difference between the actual direct labor costs incurred and the standard costs for the actual production achieved.

Direct Labour Standards

Benchmarks for the amount of labor time that is expected to be necessary to produce a unit of product or to complete a process.