At the End of 2009, SWP Prepared Its Master Budget

question 9

Multiple Choice

At the end of 2009, SWP prepared its master budget for 2010. Selected amounts from that budget, along with actual results for 2010, are presented below: The research and development cost variance could be explained by

• A) Starting too many projects
• B) Cost increases due to new information technologies
• C) Efficient cost management
• D) Higher salaries

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Definitions:

Federal Income Tax

An annual financial obligation collected by the IRS from individuals, corporations, trusts, and other legal organizations.

Gross Earnings

The total income earned by an individual or a business before any deductions or taxes are taken out.

Withholding Allowance

A claim made by an employee on a form W-4 to determine the amount of income tax withheld from their paycheck.

Federal Income Tax

A charge imposed by the IRS on the yearly income of persons, corporations, trusts, and various legal bodies.