When considering the significance of cost variances, managers should not consider
A) relative size of the variances.
B) recurring variances.
C) the trends of the variances.
D) favourable or unfavourable status of the variances.

Question

Quizplus · Accepted Answer

The significance of cost variances should indeed consider the relative size of the variances, recurring variances, and the trends of the variances to make informed decisions. However, whether a variance is favourable or unfavourable does not determine if it should be considered; both types of variances can provide valuable insights.

When Considering the Significance of Cost Variances, Managers Should Not