Allowances Should Not Be Made in the Direct Labor Quantity

question 162

Multiple Choice

Allowances should not be made in the direct labor quantity standard for

• A) wasted time.
• B) rest periods.
• C) cleanup.
• D) machine downtime.

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Definitions:

Competitive Industry

An industry where numerous firms compete against each other to sell similar products to consumers.

Average Total Cost

The total cost of production (fixed and variable costs) divided by the quantity of output produced.

Marginal Revenue

The augmented income obtained by selling one more unit of a good or service.

Marginal Cost

The increase in total cost that arises from producing one additional unit of output.