The Purpose of Using Combination Pay Methods Is To

question 26

Multiple Choice

The purpose of using combination pay methods is to:

• A) Offer employees an incentive for increased performance.
• B) Meet minimum wage requirements and offer pay for performance.
• C) Reduce salary expenses by offering variable compensation.
• D) Cross-train employees in various company functions.

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Definitions:

Flexible Budget

A budget that adjusts or flexes with changes in the volume or activity level of a business.

Overhead Volume Variance

The difference between the budgeted and actual overhead costs, attributable to variations in production volume.

Fixed Overhead Items

Costs that do not change with the level of production or sales over a certain range, such as rent, salaries, and insurance.