Assume That the Bonds Below Have the Same Term and Principal

question 98

Multiple Choice

Assume that the bonds below have the same term and principal and that the province or local government that issues the municipal bond has a good credit rating. Which listing of bonds is ordered from the one that pays the most interest to the one that pays the least interest?

• A)corporate bond, municipal bond, federal government bond
• B)corporate bond, federal government bond, municipal bond
• C)municipal bond, federal government bond, corporate bond
• D)federal government bond, municipal bond, corporate bond

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Definitions:

Variable Overhead Efficiency Variance

The difference between actual hours taken to produce something and the standard hours expected, multiplied by the variable overhead rate.

Budget Variance

The difference between the budgeted or planned amount of expense or revenue, and the actual amount incurred or received.

Fixed Overhead Budget Variance

The variance between the budgeted and the actual incurred fixed overhead expenses.

Manufacturing Overhead Applied

The portion of estimated manufacturing overhead cost that is assigned to each unit of production based on a predetermined rate.