Q1. Unfavorable variance that occurs when:
- actual costs are greater than budgeted costs.
- actual costs are lower than budgeted costs.
- actual costs equals budgeted costs.
- actual costs are lower than sunk costs.
Q.2 A continuous (or perpetual) budget:
- is prepared for a range of activity so that the budget can not be adjusted for changes in activity.
- is a plan that is updated monthly or quarterly, dropping one period and adding another.
- is a strategic plan that does not change.
- is used in companies that experience no change in sales.
Q3Arshan Industries is a division of a major corporation. Last year the division had total sales of $23,380,000, net operating income of $2,828,980, and average operating assets of $7,000,000. The company’s minimum required rate of return is 12%.
Required: What is the division’s return on investment (ROI)?
Q4 Prepare a balanced scorecard with an example of your own.
