Which One of the Following Statements Is TRUE

question 44

Multiple Choice

Which one of the following statements is TRUE?

• A) Frequently, large boards of directors are less effective than small boards of directors.
• B) Since outside directors have no other connection with the firm, they are indebted to the CEO for putting them on the board.
• C) The more members of a board of directors, the better its function.
• D) A company has an interlocking board of directors if the CEO also serves as the chairman of the board of directors.
• E) A company whose board members are elected in staggered terms is said to be an interlocking board of directors.

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Definitions:

Overhead Controllable Variance

The difference between the actual overhead costs incurred and the budgeted amounts that could be controlled or influenced by management.

Overhead Volume Variance

The difference between the budgeted overhead costs based on standard production volumes and the actual overhead costs incurred due to changes in production activity levels.

Standard Overhead Cost

The predetermined rate of allocating fixed and variable overhead expenses to goods or services produced.

Actual Overhead

Actual overhead refers to the real costs incurred for overhead expenses, such as utilities, rent, and administrative costs, during a given period.