Team Incentive Plans Are Used When Measurable Output Is the Result

question 77

True/False

Team incentive plans are used when measurable output is the result of group effort and it is challenging to separate individual contributions.

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Definitions:

Efficiency Variance

The difference between the actual amount of an input used and the amount that was expected to be used, measured in financial terms.

Variable Overhead

Costs that fluctuate with the level of production or business activity, such as utilities or raw materials.

Rate Variance

The difference between the expected standard cost and the actual cost incurred, calculated for direct labor rate, overhead rate, or material price.

Standard Direct Labor-Hours

The estimated hours required to produce a units based on standard efficiency and productivity levels.