Splitting an Activity Creates the Following Situation

question 45

Multiple Choice

Splitting an activity creates the following situation:

• A)More people working on the same activity
• B)There are possible startup and shutdown costs
• C)A resource may be moved from one activity to another and then back
• D)Both B and C are correct
• E)A, B, and C are all correct

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Definitions:

Labor Price Variance

The difference between the actual cost of labor and the standard or budgeted cost of labor over a period.

Direct Labor Cost

The total cost of work done by employees who are directly involved in the manufacture of a product or in performing a service.

Balanced Scorecard Approach

A strategy performance management tool that incorporates financial and non-financial performance indicators to provide a more comprehensive view of an organization's health.

Capacity Utilization Perspective

An assessment of how effectively an entity uses its potential output capacity, measuring the extent to which it's achieving maximum efficiency.