Which of the Following Is a Disadvantage of Decentralization

question 23

Multiple Choice

Which of the following is a disadvantage of decentralization?

• A)Fosters competition among divisions
• B)Managers have specialized knowledge
• C)Potential duplication of resources
• D)Allows top managers to focus on strategic issues

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Definitions:

FIFO Cost Assumption

"First-In, First-Out," an inventory costing method that assumes the first items put into inventory are the first ones sold, affecting the calculation of cost of goods sold and ending inventory.

Perpetual

A system or inventory accounting method where updates are made continuously to record every sale or purchase.

Periodic Inventory System

An inventory system under which the company does not keep detailed inventory records throughout the accounting period but determines the cost of goods sold only at the end of an accounting period.

Auto Manufacturer

A company that specializes in producing and selling automobiles.