A Favorable Cost Variance of Significant Magnitude

question 122

Multiple Choice

A favorable cost variance of significant magnitude:

• A) Is likely the result of exceptional planning.
• B) May lead to future improvements in production.
• C) Is strong evidence of excellent operating performance.
• D) Indicates tight financial control.
• E) Does not need to be investigated as to its underlying cause (because it is "favorable").

---

Definitions:

Algorithms

Step-by-step procedures or formulas for solving problems or completing tasks, often used in mathematics and computer science.

Deductive Reasoning

A logical process in which a conclusion is based on the concordance of multiple premises that are generally assumed to be true.

Inductive Reasoning

A logical process in which multiple premises, all believed true or found true most of the time, are combined to obtain a specific conclusion.

Subgoaling

A strategy in which a larger goal is divided into smaller, more manageable goals, facilitating easier achievement of the overall objective.