David Owns a Small Architecture Firm with 75 Employees

question 17

Multiple Choice

David owns a small architecture firm with 75 employees. He wants to use a PEO to handle his firm's HR activities. David is in the process of investigating Assure Group, a PEO. Which of the following best supports the argument that David should use Assure Group?

• A)The Assure representative explains that the PEO has been in business for one year.
• B)The Assure representative does not ask David about his company's current HR policies.
• C)The Assure representative promises David that his company will see substantial savings.
• D)The Assure representative asks David many questions about his company's safety policies.

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Definitions:

Step-fixed Costs

Costs that remain constant for a certain level of production or activity, but can change to a different fixed amount when a certain threshold is crossed.

Variable Costs

Costs that vary directly with the level of production or output.

Absorption Costing

An accounting method that includes all manufacturing costs—direct materials, labor, and both variable and fixed overhead—as part of the cost of a finished product.

Absorption Costing

An accounting method that includes all manufacturing costs - direct materials, direct labor, and both variable and fixed overheads - in the cost of a product.