Which of the Following Is Not One of the Broad

question 55

Multiple Choice

Which of the following is not one of the broad features of the ideal future procurement organizational model?

• A) A flatter hierarchy for faster decision making and freer flow of ideas along with joint ventures and alliances with key supply chain members.
• B) Requirement of having cost accounting personnel present on all cross-functional teams.
• C) Increased use of center-led structures that enable consolidation of common purchases coupled with decentralization of unique and transactional buying activities.
• D) Co-location of purchasing personnel with internal customers that will provide lower costs and improved service.
• E) Rotation of business managers across business units and functional groups.

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Definitions:

Production Volume

The amount of products a factory or plant has manufactured in a given time frame; it measures the output level of production activities.

Factory Utility Cost

The expense associated with the utilities consumed in the production process, such as electricity, gas, and water.

Mixed Cost

A cost composed of a fixed component and a variable component that changes with the level of activity or production.

High-low Method

An approach used in cost accounting to determine the variable and fixed components of a cost by analyzing the highest and lowest levels of activity.