A Direct Relationship Occurs When

question 253

Multiple Choice

A direct relationship occurs when

• A) the two variables being compared change in opposite directions, or when one goes up the other goes down.
• B) a change in one of the variables causes a change in the other variable in any direction.
• C) the two variables being compared change in the same direction, or when one goes up the other also goes up.
• D) the two variables have no identifiable relationship with each other.

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Definitions:

Overapplied

A situation in cost accounting where the allocated manufacturing overhead costs exceed the actual overhead expenses incurred.

Underapplied

A situation where the allocated or applied costs are less than the actual costs incurred.

Fixed Overhead Budget Variance

The difference between the actual fixed overhead costs incurred and the budgeted or expected costs.

Unfavorable

A term used in variance analysis to describe a situation where actual results are worse than expected results, leading to a negative impact on financial performance.