When a Firm Becomes Highly Diversified Through Acquisitions, Managers Often

question 81

True/False

When a firm becomes highly diversified through acquisitions, managers often focus on financial controls rather than strategic controls.

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Definitions:

Plantwide Factory Overhead Rate

A single overhead absorption rate calculated by dividing total factory overheads by total machine hours or labor hours, applied uniformly across all products and services.

Machine Hours

A measure of the amount of time a machine is operated, used in costing and operational efficiency analysis.

Single Plantwide Factory Overhead Rate

A method of allocating manufacturing overhead costs uniformly across all units produced within a single factory.

Direct Labor Hours

The total hours worked by employees who are directly involved in the production of goods or services.