Management by exception is the practice of concentrating on:
A)the master budget
B)areas not operating as anticipated
C)favorable variances
D)unfavorable variances

Question

Quizplus · Accepted Answer

Management by exception is a management strategy that focuses on identifying and investigating areas that deviate significantly from expected outcomes. This means that managers concentrate on areas not operating as anticipated, which could be unfavorable variances but also favorable variances if they are unexpected and indicate new opportunities. Therefore, option B represents the best choice. Options A, C, and D are not accurate because management by exception does not exclusively concentrate on the master budget or variances that are either favorable or unfavorable.

Management by Exception Is the Practice of Concentrating On