Management would generally expect unfavorable variances if standards were based on which of the following capacity measures?
$\text {\underline{ Ideal} }$ $\text {\underline{ Practical} }$ $\text {\underline{ Expected annual} }$

A)yes no no
B)no no no
C)no yes yes
D)yes yes no

Question

Management would generally expect unfavorable variances if standards were based on which of the following capacity measures?
$\text {\underline{ Ideal} }$          $\text {\underline{ Practical} }$           $\text {\underline{ Expected annual} }$

A)yes no no
B)no no no
C)no yes yes
D)yes yes no

Quizplus · Accepted Answer

Management would generally expect unfavorable variances if standards were based on the "Ideal" capacity measure. Ideal capacity means the maximum theoretical capacity that could be achieved under perfect conditions, and it does not take into account any potential inefficiencies or constraints in the production process. Therefore, standards based on ideal capacity would be difficult to achieve in practice, and any variance from these standards would likely be unfavorable. On the other hand, practical and expected annual capacity measures consider realistic production constraints and expected levels of efficiency, so variances from these standards may not necessarily be unfavorable.

Management Would Generally Expect Unfavorable Variances If Standards Were Based Ideal‾ \text {\underline{ Ideal} } Ideal​

Management Would Generally Expect Unfavorable Variances If Standards Were Based $\text {\underline{ Ideal} }$