Which of the Following Is NOT a Characteristic of a Closed

question 4

Multiple Choice

Which of the following is NOT a characteristic of a closed system?

• A) centralized decision making
• B) authority based on position and knowledge rather than rank
• C) organizational members isolated from society
• D) hierarchical structure of organization shaped like a pyramid

---

Definitions:

Operating Activities

Activities that involve the core business operations of a company, such as selling goods and services.

Depreciation Expense

The allocated portion of the cost of a tangible asset that is expensed in each accounting period during its useful life, reflecting wear and tear, deterioration, or obsolescence.

Indirect Method

A method of preparing the cash flow statement in which net income is adjusted for changes in balance sheet accounts to calculate the cash from operating activities.

Operating Activities

These involve the core day-to-day functions and transactions of a business that are directly related to its primary operations, typically reflected in the cash flows from operating activities section of the cash flow statement.