5. A favorable variance occurs on a performance report when ________.??????????

Question

5. A favorable variance occurs on a performance report when ________.??????????

A) the actual cost is greater than the budgeted cost
B) the actual profit is greater than the budgeted profit
C) the actual revenue is less than the budgeted revenue
D) the actual profit is less than the budgeted profit

6. A budget ________.
A) provides feedback by comparing actual results with planned results
B) is a quantitative expression of a plan of action
C) includes deviations from planned results
D) ignores areas that are presumed to be running smoothly

7. Management-by-exception means that managers should ________.
A) concentrate on areas that deviate from the plan
B) in the absence of other evidence, presume that areas that conform with plans are running smoothly
C) A and B
D) none of the above

Explanation / Answer

5. A favorable variance occurs on a performance report when ________

So answer is b) the actual profit is greater than the budgeted profit

6) A budget

So answer is B) is a quantitative expression of a plan of action

7) Management-by-exception means that managers should ________.

So answer is c) A and B

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