Fred Saunders Receives $61,000 a Year as a Manager

question 16

Multiple Choice

Fred Saunders receives $61,000 a year as a manager. This type of compensation is called

• A) benefits.
• B) bonus.
• C) shift premium.
• D) salary.
• E) time wage.

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Definitions:

Standard Cost System

An accounting system that uses standard costs for products or services for the purpose of controlling costs and assessing operational performance.

Standard Direct Labor-Hours

The estimated amount of labor hours required to produce a unit of product, used in budgeting and variance analysis.

Denominator Level

The activity level used to compute a predetermined overhead rate, often reflecting capacity or expected usage.

Budget Variance

The difference between budgeted figures for a set period and the actual figures achieved.