The Spoils System Is Based on Rewarding Party Loyalists and Friends

question 25

True/False

The spoils system is based on rewarding party loyalists and friends.

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Definitions:

Direct Materials

These are the raw materials that are directly incorporated into a finished product.

Prime Cost

The combined direct costs of raw material and labor that are directly associated with the production of a product.

Discretionary Fixed Costs

Those fixed costs that arise from annual decisions by management to spend on certain fixed cost items, such as advertising and research.

Committed Fixed Costs

Expenses that a company has to pay regardless of its level of production or sales, such as leases and long-term contracts, which cannot be easily changed in the short term.