When a Company Underpromises but Overdelivers with Respect to Its

question 63

Multiple Choice

When a company underpromises but overdelivers with respect to its services,it is said to be practicing ___________.

• A)Inferior service management
• B)Sandbagging
• C)Customer salience management
• D)Customer expectations management
• E)None of these

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Definitions:

Predetermined Overhead Rate

A calculated rate used to allocate manufacturing overhead costs to products or job orders, based on a projected level of activity.

Direct Labor-Hours

The total number of labor hours worked by employees who are directly involved in the manufacturing process.

Job-Order Costing System

An accounting system that accumulates costs per job rather than per time period, used in industries where goods are custom-made.

Predetermined Overhead Rate

An estimated rate used to allocate manufacturing overhead costs to individual units of production, based on a certain activity.