The Lines Along Which Responsibility and Authority Are Delegated from Top

question 36

Multiple Choice

The lines along which responsibility and authority are delegated from top to bottom in an organization is known as:

• A) chain of command.
• B) accountability.
• C) channels of communication.
• D) reverse delegation.
• E) None of the above.

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Definitions:

Fixed Costs

Costs that do not change with the level of production or sales, such as rent, salaries, and insurance premiums.

Absorption Costing

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

Variable Costing

A costing method that includes only variable production costs—direct materials, direct labor, and variable manufacturing overhead—in unit product costs.

Excess Capacity

The amount by which the actual production of a company exceeds its planned production capacity.