A Disadvantage of the Centralized Organization Is

question 53

Multiple Choice

A disadvantage of the centralized organization is:

• A) it lengthens response times by those closest to the market conditions because they must seek approval for their actions.
• B) it does not encourage responsibility among lower-level managers and rank-and-file employees.
• C) it discourages lower-level managers and rank-and-file employees from exercising any initiative.
• D) it diverts authority away from those closest to,and most knowledgeable about,the situation for actions.
• E) All of these.

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Definitions:

Direct Method

A means of reporting cash flows from operating activities that presents specific cash inflows and outflows directly rather than using the indirect method adjustments.

Reciprocal Services Method

An accounting method used to allocate costs between departments of an organization that provide services to each other.

Support Department Costs

Expenses incurred by service departments that do not directly produce goods but support other departments that do.

Total Janitorial Costs

The complete expenses associated with cleaning and maintaining a facility.