A Simple Structure Is an Organizational Form in Which the Owner-Manager

question 81

True/False

A simple structure is an organizational form in which the owner-manager makes all major decisions directly and monitors all activities, while the staff merely serves as an extension of the manager's supervisory authority.

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Definitions:

Desired Profit

The amount of financial gain a company aims to achieve from its operations, often used in setting prices and targets.

Period Cost

Costs that are not directly tied to the production process and are expensed in the period in which they occur.

Differential Cost

The difference in cost between two alternative decisions or changes in output levels.

Sunk Cost

Sunk cost represents money already spent and permanently lost, which cannot be recovered and should not influence future financial decisions.