The Expected Value of a Vehicle at the End of a Lease

question 78

Multiple Choice

The expected value of a vehicle at the end of a lease is called the

• A) Invoice price.
• B) Sticker price.
• C) Set price.
• D) Capitalized cost.
• E) Residual value.

---

Definitions:

Direct Materials Quantity Variance

The difference between the actual quantity of materials used in production and the expected quantity, multiplied by the standard cost per unit.

Price Variance

The difference between the expected price and the actual price paid for an item.

Factory Overhead Volume Variance

The difference between the budgeted and actual overhead costs due to variations in the volume of production.

Direct Labor Rate Variance

The difference between the actual cost of direct labor and the expected (or standard) cost, based on the hours actually worked.