20 Variable costing method of transfer pricing is A. easy to implement B. intuitive and easily understood C. more logical when there is excess capacity D. all of the above (2 marks) 21. The Sales budget is the second budget to be prepared after the Production budget and is drawn by multiplying the expected unit sales volume for each product by its anticipated unit selling price. TRUE / FALSE (1 mark) 22. Rolling budget is prepared when there is an element of risk and uncertainty, and the future events can be forecasted reliably. TRUE / FALSE (1 mark) 23. Currently attainable standards represent those costs that should be incurred under inefficient operating conditions. TRUE / FALSE (1 mark) 24. Operational variances are variances that are assumed to have occurred due to operational factors such as labour productivity, efficiency in material purchasing and handling or unrealistic standard or budgets. TRUE/FALSE (1 mark) 25. When deciding whether to accept a special order, spare or idle capacity is a factor that needs to be taken into account. TRUE / FALSE (1 mark) 26. Qualitative is a term used to describe factors in a decision problem that cannot be expressed effectively in numerical terms. TRUE / FALSE 27. Opportunity cost may also be described as a foregone benefit. (1 mark) TRUE / FALSE (1 mark) 28. Price skimming is when the initial product price is set high and raised. TRUE / FALSE (1 mark) 29. Goal congruence is when managers within the various units of an organization are committed to aligning their goals set by top management. TRUE / FALSE (1 mark)