When a Variable Overhead Spending Variance Is Identified,managers Will Want

question 146

True/False

When a variable overhead spending variance is identified,managers will want to talk with the purchase manager about the purchase and/or use of variable overhead items.

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Definitions:

Net Present Value

The difference between the present value of cash inflows and the present value of cash outflows over a period of time.

Present Value

The current worth of a future sum of money or stream of cash flows, given a specified rate of return.

Cash Flows

The total amount of money being transferred into and out of a business, particularly in terms of operational, investment, and financing activities.

Interest Rate

The percentage of a sum of money charged for its use, typically expressed as an annual percentage rate.