In 2010, OSW Budgeted Its Sales Volume at 10,000 Units

question 81

Multiple Choice

In 2010, OSW budgeted its sales volume at 10,000 units. Actual volume was 9,800 units. If OSW uses the static budget to calculate variances and assuming that inventory levels are insignificant, which of the following statements is true?

• A) Profits will be less than expected
• B) Budgeted variable costs will be overstated compared to actual variable costs
• C) Profits will be more than expected due to favorable cost variances
• D) Sales managers will not receive a bonus

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Definitions:

Personality Formation

The process through which children develop their own unique patterns of feeling, thinking, and behaving in a wide variety of circumstances.

Leader

An individual who guides or directs a group towards achieving specific goals or objectives.

Temperament

An individual's innate predisposition towards certain patterns of emotional reactivity and self-regulation, typically evident from early childhood.

Intellectual Abilities

The cognitive capacities of an individual, including memory, reasoning, problem-solving, and abstract thinking.