A Disadvantage of an Autonomous Project Organisational Structure Is That

question 24

True/False

A disadvantage of an autonomous project organisational structure is that it can be cost-inefficient because of underutilisation of resources.

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Definitions:

Variable Manufacturing Overhead

Indirect manufacturing costs that vary with the level of production, such as utilities for the production area.

Fixed Manufacturing Overhead

Expenses that do not vary with the level of production, such as rent, salaries, and depreciation of manufacturing facilities.

Variable Distribution Costs

Expenses related to the delivery or distribution of a product that vary in proportion to the volume of units sold.

Contribution Margin

The amount remaining from sales revenue after variable production costs and variable expenses have been deducted; used to cover fixed costs and to generate profit.