Zike Corporation's Static Planning Budget for October Appears Below

question 143

Multiple Choice

Zike Corporation's static planning budget for October appears below.The company bases its budgets on machine-hours. In October, the actual number of machine-hours was 6, 000, the actual supplies cost was $14, 740, the actual power cost was $49, 170, the actual salaries cost was $15, 390, and the actual equipment depreciation was $63, 670. The spending variance for power cost in the flexible budget performance report for the month should be:

• A)$3, 570 U
• B)$1, 170 U
• C)$3, 570 F
• D)$1, 170 F

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Definitions:

Macroeconomics

The branch of economics that studies overall economic factors, such as national productivity, total national income, and the overall levels of prices and employment.

Post Hoc, Ergo Propter Hoc

Literally, “after this (in time), therefore because of this.” A common error made in thinking about causation: If Event A happens before Event B, it is not necessarily true that A caused B.

Fallacy

A flawed argument that uses poor reasoning or misrepresents evidence, often leading to incorrect conclusions.

Inductive Reasoning

A reasoning method that involves generalizing from a set of specific observations to reach a broader conclusion.