Which of the Following Is True of an Agent

question 93

Multiple Choice

Which of the following is true of an agent?

• A) The authorization to represent the company has to be in writing.
• B) The agent's statements cannot legally bind his or her company.
• C) A person who acts in place of his or her company is an agent.
• D) The actions of an agent do not have any financial impact on the company.
• E) None of the above.

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Definitions:

Actual Costs

The true expenses incurred in the production of a product or the provision of a service, as opposed to estimated or budgeted costs.

Material Variance

Material variance is the difference between the actual cost of materials used in the production process and the expected (or standard) cost, used to analyze and control costs in manufacturing.

Standard Cost

Standard cost is an estimated or predetermined cost of performing an operation, producing a good, or delivering a service, under normal conditions, used for budgeting and assessing performance.

Materials Price Variance

The difference between the actual cost and the standard cost of materials multiplied by the quantity purchased.