These questions refer to flexible-budget variance formulas with the following descriptions for the variables: A = Actual; B = Budgeted; P = Price; Q = Quantity. The best label for the formula [(AP)(AQ) - (BP)(BQ)] is the ________.
A) efficiency variance.
B) price variance
C) total flexible-budget variance
D) spending variance

Question

Quizplus · Accepted Answer

The formula [(AP)(AQ) - (BP)(BQ)] calculates the difference between actual and budgeted costs, taking into account both price and quantity differences. This is known as the total flexible-budget variance.

These Questions Refer to Flexible-Budget Variance Formulas with the Following