Identify the Statement That Is NOT a Major Disadvantage of Placing

question 19

Multiple Choice

Identify the statement that is NOT a major disadvantage of placing a project within a functional element of the parent organization.

• A)There is a tendency to suboptimize the project.
• B)The client is not the primary focus of activity in the function.
• C)The motivation of people assigned to the project tends to be weak.
• D)The functional division contains the normal path of advancement for individuals whose expertise is in the functional area.

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Definitions:

Labour Rate Variance

The difference between the actual cost of labor and the expected (or budgeted) cost.

Standard Hours Allowed

The amount of work hours allocated to complete a specific task or project, often used in performance measurement.

Denominator Level

In cost accounting, it refers to the level of activity used to allocate fixed costs to units of production.

Standard Costing

Standard costing is an accounting method that applies estimated costs to product costs for budgeting purposes and performance evaluation, facilitating variance analysis.