Global Engineering's Actual Operating Income for the Current Year Is

question 155

Multiple Choice

Global Engineering's actual operating income for the current year is $55,000. The flexible budget operating income for actual sales volume is $48,000, while the static budget operating income is $53,000. What is the sales volume variance for operating income?

• A)$5,000 favorable
• B)$2,000 unfavorable
• C)$5,000 unfavorable
• D)$2,000 favorable

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Definitions:

Critical Value

A point on the scale of the test statistic beyond which we reject the null hypothesis.

Groups

Collections of individuals or items categorized together based on shared characteristics or purposes.

Expected Frequencies

Expected frequencies refer to the counts of observations that one expects in each category of a statistical distribution based on a hypothesis or model.

Null Hypothesis

A statistical hypothesis that assumes no significant difference or effect exists in the population from which a sample is drawn.