An Unfavorable Materials Quantity Variance Indicates That

question 234

Multiple Choice

An unfavorable materials quantity variance indicates that:

• A) actual usage of material exceeds the standard material allowed for output.
• B) standard material allowed for output exceeds the actual usage of material.
• C) actual material price exceeds standard price.
• D) standard material price exceeds actual price.

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Definitions:

Net Credit Sales

The total value of sales made on credit during a period, minus any returns or allowances.

Income Statement Approach

A way of preparing financial statements where the focus is on determining net income or loss by subtracting expenses from revenues.

Net Credit Sales

The total revenue from sales made on credit minus any returns or allowances, reflecting the actual credit sales generated and collected by a business.

Uncollectible

Refers to debts that have been deemed uncollectible from debtors, often written off as a loss by the business.