If Control Standards Are Too High, They No Longer Motivate

question 106

True/False

If control standards are too high, they no longer motivate.

---

Definitions:

Contribution Margin

The difference between the sales revenue generated from a product or service and the variable costs associated with its production and sales.

Variable Costing

A costing method that includes only variable manufacturing costs—direct materials, direct labor, and variable manufacturing overhead—in the cost of goods sold and excludes fixed manufacturing overhead.

Absorption Costing

A costing method that includes both variable and fixed manufacturing overhead costs in the cost of a product.

Net Income

The net income a business realizes once it has subtracted all outgoings and fiscal charges from its revenue.