Which of the Following Statements Is True

question 30

Multiple Choice

Which of the following statements is true?

• A) An unfavorable materials price variance could have resulted from actions taken by the purchasing agent.
• B) An unfavorable materials usage variance could have resulted from actions taken by the production supervisor.
• C) An unfavorable labor usage variance could have resulted from actions taken by the personnel department.
• D) All of these answers are correct.

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Definitions:

Operating Activities

Day-to-day actions and transactions that are central to the primary business operations, including revenue and expense activities.

Indirect Method

A method used in cash flow statements to adjust net income for the changes in non-cash accounts to arrive at operating cash flow.

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within a year or within the operating cycle of a business.

Fixed Assets

Tangible assets, such as property, plant, and equipment, used in the operating activities of a business and not intended for sale in the normal course of business.