An Unfavorable Activity Variance Indicates That Activity Was Too High

question 178

True/False

An unfavorable activity variance indicates that activity was too high for the amount of sales.

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Definitions:

Materials Price Variance

A financial measure used to determine the variation in the cost of raw materials against the pre-defined standard cost.

Raw Materials Inventory

The stock of basic materials that are to be used in production but have not yet been processed.

Cash Account

An account recording the transactions involving cash inflows and outflows.

Direct Labor Costs

These refer to the expenses associated with paying workers who directly manufacture or produce the goods and services.