Signals Are Believable When the Cost of Sending a ________

question 37

Multiple Choice

Signals are believable when the cost of sending a ________ is known to be ________.

• A) false signal; low
• B) false signal; high
• C) true signal; low
• D) true or false signal; low
• E) true signal; high

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Definitions:

Standard Cost System

A cost accounting system that uses cost standards for materials, labor, and overhead to control actual costs and analyze variances.

Favourable Variance

A financial term referring to a situation where actual costs are less than budgeted costs, or actual revenues exceed budgeted revenues.

Variable Overhead Efficiency Variance

A measure of the difference between the expected variable overhead based on standard costs and the actual variable overhead incurred.

Flexible Budget

A report showing estimates of what revenues and costs should have been, given the actual level of activity for the period.