One Potential Disadvantage of Using Contingent Workers Is That

question 39

Multiple Choice

One potential disadvantage of using contingent workers is that:

• A)the costs for their health care, paid time off, and contributions to a retirement plan can be considerable
• B)the company may have to adjust the number of contingent workers that it uses to meet business needs
• C)there can be substantial training expenses
• D)they may not feel a strong connection to the company for which they are working

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Definitions:

Flat Fee

A charged price for a service that does not vary with usage or time.

Overhead

All manufacturing costs that cannot be directly traced to a product. Overhead includes indirect labor and materials, plant depreciation, insurance and property taxes, plant management salaries, and so forth. See Indirect Cost Pool.

Direct Labor

The workforce involved in the hands-on manufacturing of goods or provision of services.

Variable Factory Overhead

Expenses that fluctuate with the level of production output, such as utilities or materials used in the manufacturing process.