Onyx Company Prepared a Static Budget at the Beginning of the Month

question 69

Multiple Choice

Onyx Company prepared a static budget at the beginning of the month. At the end of the month, the company is analyzing actual results versus budget using flexible budget methodology. Data are as follows: Based on the above data, how much was the flexible budget variance for operating income?

• A)$4,500 U
• B)$4,500 F
• C)$380 U
• D)$5,490 F

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Definitions:

General Principles

Broad and fundamental guidelines or rules that form the basis for a field of study or profession.

GAAP

Generally Accepted Accounting Principles, the standard framework of guidelines for financial accounting used in any given jurisdiction, notably in the United States.

Limited Liability Company

A business structure that combines the pass-through taxation of a partnership or sole proprietorship with the limited liability of a corporation.

Tax Treatment

The specific methodology applied to determine the amount of taxes owed by an individual or business.