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The Production-Volume Variance Only Exists Under Variable Costing and Not

question 92

True/False

The production-volume variance only exists under variable costing and not under absorption costing.


Definitions:

Compensating Balance

A minimum account balance that a company agrees to maintain in a bank account, often to qualify for favorable terms on a loan from the bank.

Effective Rate

The interest rate on a loan or investment, adjusted for the compounding period, providing a true reflection of financial costs or returns.

Terms of Sale

The conditions under which a seller is willing to sell a product or service, including price, payment method, and delivery time.

Prompt Payment Discount

A reduction in the amount due on a bill offered by a seller to encourage early payment by the buyer.

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