FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Concept explainers

Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for …
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on t…
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QUESTION 9

  1. QRC Company is trying to decide which one of two alternatives it will accept. The costs and revenues associated with each alternative are listed below:

      Alternative A   Alternative B
    Projected revenue $ 62,500     $ 75,000  
    Unit-level costs   12,500       18,000  
    Batch-level costs   6,250       12,000  
    Product-level costs   7,500       8,500  
    Facility-level costs   5,000       6,250  
    ​
    What is the differential revenue for this decision?
       
    $62,500
       
    $25,000
       
    $75,000
       
    $12,500
     
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