The Aggregate of Direct Materials Cost and Efficiency Variances Results

question 114

True/False

The aggregate of direct materials cost and efficiency variances results in total direct materials variance.

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Definitions:

Relevant Range

The range of activity within which the assumptions made about cost behavior in cost-volume-profit analysis are valid.

Cost Estimates

A predictive calculation of the anticipated expenses for a project or production, used for budgeting and planning purposes.

Marginal Cost

The cost of producing one additional unit of a product or service.

Relevant Range

The range of activity or volume in which the assumptions about fixed costs and variable costs are valid.