Which One of the Following Is True Concerning a CVP

question 25

Multiple Choice

Which one of the following is true concerning a CVP income statement?

• A)Costs and expenses are classified only by function.
• B)It is prepared for both internal and external use.
• C)It shows contribution margin instead of gross profit.
• D)Costs and expenses are classified as product or period.

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Definitions:

Flattening Hierarchy

The process of reducing levels in an organization's structure to decrease distance between managers and employees and promote quicker decision-making.

Span of Control

Describes the number of subordinates that a manager or supervisor can effectively oversee, directly affecting management layers and organizational structure.

Matrix Departmentalization

An organizational structure that combines two or more types of departmentalization, often functional and product, to leverage the benefits of both.

Decentralization

The distribution of decision-making governance closer to the level of individual parts or locations within an organization, rather than concentrated at a central point of authority.