The Condition That Exists When the Organization's Parts Interact to Produce

question 115

Multiple Choice

The condition that exists when the organization's parts interact to produce a joint effect that is greater than the sum of the parts acting alone is known as:

• A) core competence.
• B) synergy.
• C) value creation.
• D) business-level strategy.
• E) multidomestic strategy.

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Definitions:

Markup

The surcharge applied to the original cost of items to compensate for overhead expenses and secure earnings.

Plantwide Predetermined Rate

A single overhead rate calculated using the total estimated overhead costs divided by an estimated allocation base for an entire factory or plant.

Machine-Hours

A measure of the time that a machine is in operation, used in costing and operational analysis.

Departmental Predetermined Rates

Overhead allocation rates set in advance for specific departments to allocate indirect costs more accurately.