Examlex

Solved

In Variance Analysis, If Any Single Performance Measure Is Underemphasized

question 115

True/False

In variance analysis, if any single performance measure is underemphasized, managers will tend to make decisions that will cause the particular performance measure to look good.


Definitions:

Operating Period

The time frame during which a business operates to achieve its set objectives, which can be measured daily, monthly, quarterly, or annually.

Net Operating Income

The profit generated from a business's operational activities, excluding taxes and interest.

Common Fixed Expenses

Costs that do not change with the level of production or sales, shared across different segments or products of a company.

Business Segments

Portions of a company that can be separately identified by the products they offer or the regions they operate in, for financial reporting purposes.

Related Questions