Vaughn Studios Organizes Its Operations by Activity, Such as Production

question 100

Multiple Choice

Vaughn Studios organizes its operations by activity, such as production, marketing, accounting, and finance. Vaughn utilizes _____________ departmentalization in order to maximize their efficiency

• A) product
• B) customer
• C) functional
• D) standardized

---

Definitions:

Variable Overhead

Costs that vary with the level of production or business activity, such as utilities or materials, in contrast to fixed overhead costs.

Direct Labor

The wages or costs associated with workers who are directly involved in the manufacturing or production of goods or services.

Direct Materials

Raw materials that are directly attributed to the production of a product and are easily traceable to the manufacturing process.

Variable Overhead

Costs that vary with the level of production output, such as utilities for manufacturing equipment, which increase as production increases.