In a Standard Cost System, the Volume Variance Will Be

question 8

Multiple Choice

In a standard cost system, the volume variance will be unfavourable when

• A)actual hours are greater than the denominator hours.
• B)the standard hours allowed for the output of the period are less than the denominator hours.
• C)the standard hours allowed for the output of the period are greater than the actual hours incurred.
• D)actual hours are less than the denominator hours.

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Definitions:

Period

A length or portion of time, often defined by specific beginning and end points, in various contexts.

User Costs

The expense of using a good or service, including both the actual cost of obtaining it and the opportunity cost of forgoing the next best alternative.

Nonrenewable Resource

A natural resource that cannot be replenished at the same rate it is consumed, such as fossil fuels, minerals, and certain metals.

Future Profits

Anticipated earnings or profits that a business expects to generate in the future based on current plans and projections.