Which One of the Following Is a Problem Resulting from a Service

question 90

Multiple Choice

Which one of the following is a problem resulting from a service company being overstaffed?

• A) Labor costs will be disproportionately low.
• B) Profits will be higher because of the additional salaries.
• C) Staff turnover may increase.
• D) Revenue may be lost.

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Definitions:

Straight-line Method

A method of allocating the cost of a tangible asset over its useful life in equal annual amounts.

Salvage Value

The projected remaining worth of an asset upon reaching the end of its serviceable duration.

Depreciation Expense

The allocation of the cost of a tangible asset over its useful life, reflecting its decrease in value over time.

Straight-line Depreciation

A method of allocating the cost of a tangible asset over its useful life evenly.