The Following Information Is Available for Adam Ltd The Variable Expense Variance Is:
A)$22,000 U
B)$33,500 U
C)$16,000

question 1

Multiple Choice

The following information is available for Adam Ltd $\begin{array}{|l|r|r|r|}\hline &{\text { Budget }} &{\text { Actual }} &{\text { Variance }} \\\hline \text { Sales units } & 7,500 & 8,000 & 500 \mathrm{~F} \\\hline \text { Sales dollars } & \$ 375,000 & \$ 376,000 & \$ 1000 \mathrm{~F} \\\hline \text { Variable Expenses } & \$ 262,500 & \$ 296,000 & \$ 33,500 \mathrm{U} \\\hline \text { Contribution margin } & \$ 112,500 & \$ 80,000 & \$ 35,000 \mathrm{U} \\\hline\end{array}$ The variable expense variance is:

• A)$22,000 U
• B)$33,500 U
• C)$16,000 U
• D)$22,500 F

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Definitions:

Minority Shareholder

An investor who owns less than 50% of a company's shares, typically having limited influence over corporate decisions.

Business Judgment Rule

A principle that shields corporate executives from liability for decisions made in good faith and believed to be in the best interest of the company, even if they are ultimately unsuccessful.

Directors Meeting

A formal gathering of the board of directors of a company to discuss and make decisions on corporate affairs.

Duty of Loyalty

An obligation to act in the best interest of another party, typically within the context of a fiduciary relationship.