If an actual result in static budget is $2500 and the corresponding budgeted amount is $2200, then the static budget variance will be __________?
Correct answer: B. $300
- A. $3,000
- B. $300
- C. $4,700
- D. $4,500
Explanation
Static budget variance equals actual results minus the original static budget: $2,500 minus $2,200 equals $300. Because actual cost is higher than budget, it is an unfavorable variance, although the amount is $300.
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About Financial Statements
Financial statements present a business's financial performance and position through the income statement, statement of financial position, cash flow statement and changes in equity. Questions involve preparing and interpreting these statements, adjusting entries, depreciation, closing inventory, accrued and prepaid items, and distinguishing profit from cash flow.
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