Answer the following questions using the information below:
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 (AQ - BQ)BP is the ________.
A) efficiency variance
B) price variance
C) total flexible-budget variance
D) spending variance

Question

Quizplus · Accepted Answer

The formula (AQ - BQ)BP represents the efficiency variance, which measures the difference in quantity used versus budgeted quantity, multiplied by the budgeted price.

Answer the Following Questions Using the Information Below