Managers Need to Address Six Key Elements When They Design

question 133

True/False

Managers need to address six key elements when they design their organization's structure: work specialization, departmentalization, chain of command, span of control, centralization and decentralization, and formalization.

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Definitions:

Weighted-Average Method

A method for valuing inventory that determines the cost of goods sold and the final inventory value by computing the average cost of all products available for sale throughout the period.

Conversion Costs

The combined costs of direct labor and manufacturing overhead, which are incurred to convert raw materials into finished goods.

Process Costing

A costing method used in mass production where costs are assigned to processes or departments, not individual units.

Conversion Costs

The total expense required to convert raw materials into finished goods, including labor and overhead costs.