Which of the Following Characteristics Is Least Likely to Be

question 86

Multiple Choice

Which of the following characteristics is least likely to be found in a well-designed expense plan for sales reps?

• A)Salespeople should net more income (through their expense accounts)while on the road than they earn at home,because travel is such physically hard work.
• B)Expense payments normally should vary from one part of the country to another,in order to reflect the differences in living costs.
• C)Minimize the disputes between management and sales force regarding expense account items.
• D)Minimize,and hopefully eliminate,expense-account padding.
• E)The plan should be simple and economical to administer.

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Definitions:

Return On Investment

A measure used to evaluate the efficiency or profitability of an investment relative to its cost.

Activity Base

A measure or factor used for allocating costs to activities, typically driving the amount of expense incurred in producing a product or providing a service.

Service Departments

Units within an organization that provide support services to other departments but do not directly contribute to revenue generation.

Return On Investment

A measure used to evaluate the profitability of an investment, calculated as a ratio of net profit to the initial cost of the investment.