The Benefits of a Simple Structure Include All of the Following

question 60

Multiple Choice

The benefits of a simple structure include all of the following EXCEPT ________.

• A) Ease of coordination within the organization
• B) The lack of need for sophisticated information systems
• C) Active involvement by the owner-manager
• D) Specialists that can develop deep expertise

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Definitions:

Machine-Hours

This refers to the total number of hours that machinery is in operation, used as a basis for allocating manufacturing overhead to products.

Predetermined Overhead Rate

A rate used to allocate manufacturing overhead costs to products or job orders, calculated before the period begins based on estimated overhead and activity levels.

Machine-Hours

Rephrased: The total hours that machinery is in operation during a specific period, used as a basis for allocating manufacturing overhead costs.

Predetermined Overhead Rate

A rate calculated to estimate the manufacturing overhead cost per unit of production activity, aiding in budgeting and cost control.