When Machine-Hours Are Used as a Cost-Allocation Base, the Item

question 37

Multiple Choice

When machine-hours are used as a cost-allocation base, the item most likely to contribute to a favorable production-volume variance is:

• A)an increase in the selling price of the product
• B)the purchase of a new manufacturing machine costing considerably less than expected
• C)a decline in the cost of energy
• D)strengthened demand for the product

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Definitions:

Utilitarianism

An ethical theory that posits the greatest happiness of the greatest number should be the guiding principle of conduct.

Compel Citizens

Enforcing or obliging citizens to follow certain laws, regulations, or directives through legal or authoritative means.

Medical Tests

Procedures and examinations conducted to determine the presence of disease or monitor health conditions.

Rule Utilitarian

A form of utilitarianism that evaluates the moral correctness of an action based on rules that, if universally followed, would lead to the greatest good for the greatest number.