A Company Does Not Need to Know the Price of Each

question 7

Multiple Choice

A company does not need to know the price of each resource it employs if it wants to determine whether or not it is achieving

• A) technological efficiency.
• B) economic efficiency.
• C) accounting efficiency.
• D) managerial efficiency.

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Definitions:

Equivalent Units

A concept used in cost accounting to standardize the quantities of produced goods, accounting for partially completed units.

Physical Units

Refers to the actual count or quantity of items, products, or assets, without regard to their value or cost.

Materials Added

Raw materials introduced into the production process to create a product.

Equivalent Units

A concept in cost accounting used to apportion costs to partially completed goods, calculated by considering the work done on them as equivalent to a certain number of fully completed units.