A Manager Makes a Decision That Is Beneficial for a Specific

question 58

Multiple Choice

A manager makes a decision that is beneficial for a specific investment center but not for the entire organization.From the organization's perspective,this decision results in

• A)goal congruence.
• B)decentralization.
• C)contingent compensation.
• D)fixed compensation.

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Definitions:

Direct Expenses

Expenses that can be directly traced to producing specific goods, services, or units of production without any allocation.

Departmental Income Statements

Financial reports that detail the revenue, expenses, and net income for specific departments within an organization.

Service Departments

Units within an organization that provide support services to other departments rather than directly contributing to profit generation.

Operating Departments

Departments within an organization that are directly involved in carrying out its primary activities or business operations.