Accrual Accounting and the Adjusting Process Rely on Two Principles

question 13

Short Answer

Accrual accounting and the adjusting process rely on two principles: the ________ principle and the ________ principle.

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Definitions:

Labor Efficiency Variance

The difference between the actual hours worked and the standard hours planned, multiplied by the labor rate.

January

The initial month in the Gregorian calendar, marking the start of the year.

Materials Quantity Variance

The financial difference between the actual quantity of materials used in production and the expected quantity, based on standard costs.

February

The second month of the year, often associated with cold weather in the Northern Hemisphere and used as a time period reference in accounting.