Why Is the Budget Variance the Real Control Variance, for Fixed

question 73

Multiple Choice

Why is the budget variance the real control variance, for fixed overhead?

• A) It compares budgeted expenditures with budgeted fixed overhead costs.
• B) It compares actual expenditures with budgeted fixed overhead costs.
• C) It compares actual expenditures with budgeted variable overhead costs.
• D) It compares the static budget with the flexible budget.

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Definitions:

Income

The financial gain (earned or unearned) accruing over a given period of time.

Utility Functions

Mathematical expressions used in economics to represent a consumer's preference ranking for various bundles of goods.

Consumption

The utilization of goods and services by households or individuals to satisfy their needs and wants.

Grain

The small, hard seeds of cereal plants like wheat, rice, and corn, used as a primary source of food for humans and animals.