All of the following factors should influence the decision to investigate a variance except:

Multiple Choice

a. Materiality of the variance amount.

b. Frequency of occurrence.

c. The direction of the variance (favorable or unfavorable).

d. Capacity for management to control.

c. The direction of the variance (favorable or unfavorable).

Explanation:

During the process of investigation of the variance,

Materiality of the variance amount is considered, as the small variances are analyzed or not analyzed, but to a very low extent.

Frequency of occurrence, is important.

And the capacity of the management to control.

The direction of the variance, even it it is non favorable but the amount small, then there is no need for the investigation.