Which One of the Following Is a Measure of the Performance

question 116

Multiple Choice

Which one of the following is a measure of the performance of the manager of a profit centre?

• A)ROI
• B)success in meeting budgeted goals for non-controllable costs
• C)amount of controllable margin generated
• D)amount of residual income generated

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Definitions:

Variable Overhead

Costs of production that fluctuate with the level of output, such as utility expenses and some types of labor costs, which are not directly tied to the volume of production.

Spending Variance

The difference between the actual amount spent and the budgeted amount for a particular cost or expense category.

Standard Cost

A predetermined cost of manufacturing or producing a product or performing a service under normal conditions.

Budget Variance

The difference between the budgeted or projected financial performance and the actual performance.