Question 32
5 pts
Suppose your company was examining materials costs, and suppose those
costs are strictly variable in nature. If you prepared a performance report that
compared actual results to your static budget, the variance you found at that
level be useful in determining if the production manager did
a good job controlling materials costs for the period under review. However,
if you calculated a variance by comparing actual results to
a flexible budget, that would give you a better idea of how well costs were
controlled, and if you took that a step further and broke that variance down
into and variances, you'd REALLY
start to have a good sense of where potential differences came from this
period.
would not; revenue; rate; quantity
would; spending; cost; efficiency
would; spending; rate; efficiency
would not; spending; price; quantity
