A Company with an Organization Structure Based on Product Lines

question 62

True/False

A company with an organization structure based on product lines is likely to maintain this structure for its international operations.

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Definitions:

Direct Expenses

Costs that can be directly attributed to the production of goods or services, such as raw materials and labor.

Transfer Price

The price at which divisions of a company transact with each other, often used for the sale of goods or services within the company.

Variable Cost

Costs that vary directly with the level of production or sales, such as raw materials and direct labor.

Ample Capacity

A situation where a company has enough or more than enough capacity to meet its current production or operation needs.