The Main Drawback to Utilitarian Reasoning Is That

question 48

Multiple Choice

The main drawback to utilitarian reasoning is that:

• A) The majority may override the rights of those in the minority.
• B) Managers using this reasoning process often fail to consider the means taken to reach the end.
• C) It is difficulty to accurately measure both costs and benefits.
• D) Cost-benefit calculations can only be provided by accountants.

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Definitions:

Flexible Budget

A budget that adjusts or flexes with changes in volume or activity.

Fixed Costs

Costs that do not vary with changes in the volume of production or sales, such as rent, salaries, and insurance.

Activity Level

A measure in cost accounting that identifies the extent to which cost drivers affect the cost of producing goods or services.

Materials Price Variance

The difference between the actual cost of direct materials and the expected cost, based on standard price and actual quantity purchased.