It Is Important That Cost Management Systems Are Designed Using

question 77

True/False

It is important that cost management systems are designed using the cost-benefit principle so that the costs of gathering additional information are balanced against the benefits of that information.

---

Definitions:

Rights Offering

A financial mechanism wherein a company offers its existing shareholders the opportunity to buy additional shares directly from the company at a discounted price, before the company offers it to the general public.

Stock Price

The cost of purchasing a share of ownership in a company, fluctuating based on supply and demand in the stock market.

Net Income

The net income of a company once all costs and taxes are subtracted from its total revenue.

Equity Shares

Equity Shares represent ownership in a company, granting shareholders voting rights and a share in the company's profits through dividends.