The Difference Between the Amount Budgeted and the Actual Amount

question 10

Multiple Choice

The difference between the amount budgeted and the actual amount received or spent is called the

• A) Budget variance.
• B) Cash outflow.
• C) Income.
• D) Cash inflow.
• E) Variable expense.

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Definitions:

Cost of Equity Capital

The return required by equity investors as compensation for their investment risk.

WACC

Weighted Average Cost of Capital, a measure of the average rate of return a company is expected to pay its securities holders to finance its assets.

Debt Financing

The practice of borrowing funds to finance the business operations or expansion, typically involving loans or issued bonds.