Use the following information to answer Questions 5 and 6 I Interval scale 11 Nominal scale III Ordinal scale IV Ratio scale 5 Jane calculated the material quantity variance by comparing the standard cost of materials (set by management) with the actual cost of materials. The standard cost was $10,000 and the actual cost was $10,200. Therefore the materials quantity variance was $200 (unfavourable). The variance is based on: a) I. b) II. c) III. d) IV. 6 Which of the above could be used for ranking? a) I and IV. b) II and III c) Only !!! d) 1, ill and IV. Use the following information to answer Questions 7 and 8 | Free riders 11 Lobbying III Free market approach Standard setters 7 Which of these terms are associated with private interest theory? a) I and II b) III and IV. c) I and IV. d) II and III 8 Which of the following statements is INCORRECT? a) I are likely to over-demand accounting information because it is free. b) Il requires financial resources and organisation. c) III will ensure that firms disclose comparable information. d) IV could be government or another body 9 Which of the following is least likely to reflect economic reality? al Current cost. b) Fair value. c) Historical cost. d) Market value. 10 Which of the following statements is INCORRECT? a) Market value is ideally based on active markets. b) Current cost is relevant for replacement decisions. c) Historical cost is easy to verify. d) Fair value is not reliable