A favorable variance
A) is an indication that the company is not operating in an optimal manner.
B) implies a positive result if quality control standards are met.
C) implies a positive result if standards are flexible.
D) means that standards are too loosely specified.

Question

Quizplus · Accepted Answer

A favorable variance means that actual results are better than expected or budgeted results. If quality control standards are met, then it indicates that the company is producing high-quality products or services, which is a positive result. Therefore, option B is the correct answer.

A Favorable Variance