Which of the Following Is NOT a Factor in Determining

question 52

Multiple Choice

Which of the following is NOT a factor in determining the effectiveness of an incentive program?

• A) Timing of the incentive
• B) Contingency of the consequences
• C) Type of incentive used
• D) All three factors should be considered

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Definitions:

Controllable Variance

The difference between actual costs and budgeted costs that management has the power to influence or control through decisions and actions.

Variable Factory Overhead

Costs in manufacturing that vary with the level of production output, such as utilities and materials used in the production process.

Controllable Variance

The difference between actual budgeted costs and the controllable costs within a budget period.

Fixed Factory Overhead

Indirect manufacturing costs that remain relatively constant regardless of the level of production, such as rent, depreciation, and salaries of factory supervisors.