Which of the Following Is Not One of the Positive

question 61

Multiple Choice

Which of the following is not one of the positive attributes of responsibility accounting?

• A) Managers should understand the source of significant variances to budget and should be prepared to explain the reasons for discrepancies to senior management.
• B) By assigning responsibilities for each cost,better cost control should result.
• C) Senior management can more easily identify employees to blame.
• D) Managers should take the initiative to correct unfavourable discrepancies.

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Definitions:

Useful Life

The estimated duration of time over which an asset is expected to be functional and contribute to a company's operations.

Revenue Expenditures

Short-term expenses incurred during normal business operations that are charged against revenue in the period they are incurred.

Capital Expenditures

Funds used by a company to acquire, upgrade, and maintain physical assets such as property, plants, buildings, technology, or equipment.

Major Overhaul

A significant restoration or repair of equipment, aimed at extending its useful life.