A Firm Uses a Just-In-Time (JIT) Inventory System and Has

question 42

Multiple Choice

A firm uses a Just-in-Time (JIT) inventory system and has an unfavorable selling price variance for the period just ended. If the proportion of the total variable manufacturing costs to total sales in both the flexible budget and the actual operating results is 70%:

• A) The firm has an unfavorable total variable manufacturing cost variance.
• B) The firm has a favorable total variable manufacturing cost variance.
• C) The firm has an unfavorable total flexible-budget variance.
• D) The firm has a favorable contribution margin variance.
• E) The firm has a favorable total flexible-budget variance.