Monday, June 13, 2011

When machine-hours are used as a cost-allocation base, the item MOST likely to contribute to a favorable production-volume variance is

ACCOUNTING

Multiple Choice

When machine-hours are used as a cost-allocation base, the item MOST likely to contribute to a favorable production-volume variance is

a. an increase in the selling price of the product.

b. the purchase of a new manufacturing machine costing considerably less than expected.

c. a decline in the cost of energy.

d. strengthened demand for the product.

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