1. Management by exception is a practice whereby managers focus more closely on:

Group of answer choices

A Variances in larger departments or cost centers.

B Activity that is outside of an expected tolerance range.

C Activity that falls within an expected tolerance range creating a possible exception risk.

D Unfavorable variances because of their negative impact on profits.

2. Two main purposes of the budgeting process are:

Group of answer choices

to comply with the law and generally accepted accounting principles

to report and assess

to plan and control activities of a company.

to find under performing areas so managers can be disciplined and blame assigned

3. Which of the following would not have a variance between the static budget and the flexible budget assuming activity levels change?

Group of answer choices

Fixed costs.

Variable costs.

Revenues.

Contribution margin.

4. An unfavorable efficiency variance for direct materials could be the result of:

Group of answer choices

We had to throw out several cases of materials because it was not of sufficient quality.

We had more customers than expected, causing more production than planned.

We used managers to do production line work.

We paid more than expected because of a shortage of materials.