Distinguishing Between Controllable and Noncontrollable Costs on a Performance Report

question 3

Multiple Choice

Distinguishing between controllable and noncontrollable costs on a performance report may result in:

• A) an increase in the effectiveness of a cost management system.
• B) a decrease in goal congruent behavior by managers.
• C) an increase in the quality of performance information.
• D) an increase in feelings of blame by managers.
• E) an increase in the effectiveness of a cost management system and an increase in the quality of performance information.

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Definitions:

Labor Abundance

A situation where there is a large supply of workers relative to the demand for labor, which can affect wages and employment levels.

Textiles

Fibrous materials, including cloth and fabric, that are woven, knitted, or otherwise processed for use in producing goods like clothing, home furnishings, and industrial products.

Specialize

The process of focusing on a narrow area of expertise or production to increase efficiency and quality.

Trade Advantage

The benefit or gain that one entity has over another entity in the context of international trade or markets.