Quality Brand Products Uses Standard Costing to Manage Their Direct

question 29

Multiple Choice

Quality Brand Products uses standard costing to manage their direct costs and their overhead costs. Overhead costs are allocated based on direct labor hours. In the first quarter, Quality Brand had an unfavorable price variance for their variable overhead costs. Which of the following scenarios would be a reasonable explanation for that variance?

• A) The actual number of direct labor hours was lower than budgeted.
• B) The actual costs were higher than budgeted.
• C) The actual costs were lower than budgeted.
• D) The actual number of direct labor hours was higher than budgeted.

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Definitions:

Type Of Business

Refers to the classification of a business based on its activities, ownership structure, or scale of operations.

Organizational Buying Process

The process through which formal organizations determine the necessity for products and services to be purchased, and select, assess, and decide between different brands and providers.

Consumer Buying Process

The steps that consumers go through when deciding to purchase a product or service, typically including need recognition, information search, evaluation of alternatives, purchase decision, and post-purchase behavior.

Stages

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