1. Review the meaning of the concepts or terms given in Key Terms and Concepts.
2. An important point in variance analysis is that
a. every variance must be investigated.
b. a responsibility center's variances are calculated holding all other things constant.
c. often variances cannot be separated.
d. all of the above.
3. Which function is normally responsible for sales volume variances?
a. marketing
b. administration
c. production
d. top management
4. How would management evaluate performance without a budget?
5. Could some responsibility centers differ as to the type of budget items for which they are accountable? That is, might some responsibility centers be responsible only for costs, some only for revenues, and some for both? Give examples.
6. Refer to Exhibit 10.11 on page 369. How does ‘‘percentage of positions filled from within the company'' measure worker involvement and commitment?
7. What is the difference between a standard and a budget?
Text Book: Managerial Accounting: An Introduction to Concepts, Methods and Uses By Michael Maher, Clyde Stickney, And Roman Weil.