A Layered Pay Structure Is More Hierarchical Than a Delayered

question 36

True/False

A layered pay structure is more hierarchical than a delayered pay structure and less egalitarian in terms of number of levels.

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Definitions:

Variable Cost

A cost that varies in direct proportion to changes in the level of production or sales volume.

Cost Driver

A factor, such as machine-hours, beds occupied, computer time, or flight-hours, that causes overhead costs.

Indirect Materials

Small items of material such as glue and nails that may be an integral part of a finished product, but whose costs cannot be easily or conveniently traced to it.

Machine Hours

A measure of the total time that production equipment is operational, used to allocate machine-related expenses to products.