The Two Main Innovations in a Multidivisional Structure (Over a Functional

question 24

Multiple Choice

The two main innovations in a multidivisional structure (over a functional or product structure) are

• A) a matrix structure at the divisional level and a flat structure at the corporate level.
• B) a product structure at the divisional level and a functional structure at the corporate level.
• C) the organization of business units or companies in each industry in which it competes into one or more divisions and the creation of corporate-level positions to oversee the activities of divisional managers.
• D) self-contained divisions with operating responsibility and a group of divisional managers with collective strategic responsibility.
• E) a matrix structure at the divisional level and a functional structure at the corporate level.

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Definitions:

Standard Amount

A benchmark or norm for measuring performance, often used in budgeting and accounting to set expected costs or outputs.

Variable Manufacturing Overhead

Refers to the production costs that change in proportion to the amount of production output, excluding direct materials and direct labor costs.

Direct Labor-Hours

The total hours worked directly on the manufacture of products, used for assigning labor costs to units of production.

Materials Price Variance

The difference between the actual cost of materials purchased and the expected cost, often used to monitor and control production costs.