The Difference Between the Actual Operating Income of the Period

question 113

Multiple Choice

The difference between the actual operating income of the period and master budget operating income for the period is defined as the:

• A) Total flexible-budget variance.
• B) Sales volume variance.
• C) Sales price variance.
• D) Operating income flexible-budget variance.
• E) Total operating income variance.

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Definitions:

Warranty Action

Legal action taken to enforce the terms of a warranty, which is a guarantee provided by a seller to a buyer regarding the condition of a product.

Negligence

The failure to exercise the care that a reasonably prudent person would exercise in similar circumstances, leading to unintended harm or damage.

Proximately Caused

Refers to an event sufficiently related to a legally recognizable injury to be held as the cause of that injury.

Horizontal Privity

A legal term referring to the relationship between parties with coordinating interests in a property, often in lease agreements.