Select the Term from the List That Best Matches the Description

question 15

Essay

Select the term from the list that best matches the description or definition.Enter the number of the best answer in "Your Answer" column. $\begin{array}{|l|l|l|}\hline \text {Your Answer } & \text {Defiution or Description }& \text {Term } \\\hline & \text { A. Practice of holding a manager responsible for reveme and expense items over which he or the exercises predominant control }& \text {1. Controllability concept } \\\hline & \text {B. Type of responsiblity center where the manager influences only costs and is held acconntable for a specific output at a given level of cost}& \text {2. Cost-based transfer price } \\\hline & \text {C. Measure of the abality of a firm or segment within a firm to utilize available resources effectively to genterate a positive retum for shareholders}& \text {3. Cost center } \\\hline & \text { D. Transfer price based on the external market price less any cost savings}& \text {4. Decentralization } \\\hline & \text {E. Situation that motivates a manager to act in his or her own best interest even though the corporation as a whole nay suffer}& \text {5. Investment center } \\\hline & \text {F. The point in an organization where the control over revenue or expense items is located }& \text {6. Management by exception } \\\hline & \text {G. Transfer price that is based on the listorical or standard cost incurred by the supplying segnent}& \text {7. Market-based transfer price } \\\hline & \text {H. Type of responsibility center where the manager can inflnence revenues, expenses, and capital invested in his or her center to attain the best performance possible }& \text {8. Negotiated transfer price } \\\hline & \text { I. Type of responsibility center where the manager can influence both revemes and expenses for his or her center }& \text {9. Profit center } \\\hline & \text { J. Approach that evahates a managet on lis or her ability to maxinize the dollar value of earnings above some targeted level of earnings }& \text {10. Residnal inconse} \\\hline & \text { K. Reports comparing bodgeted and actual controllable costs for each center within a firm }& \text {11. Responsibilty center } \\\hline & \text { L. When variances from the budget are emphasize d in reporting procedures so that management concentrates its attention on those variances from the budget }& \text {12. Responsibilty reports } \\\hline & \text { M. Transfer price that is established by agreement of both the selling and buying segments of the firm }& \text {13. Retum on investment } \\\hline & \text { N. Practice of delegating authority and responswility for the operation of business segments }& \text {14. Suboptinization} \\\hline\end{array}$

---

Definitions:

EBITDA Coverage Ratio

A financial metric that assesses a company's ability to pay off its debts, calculated by dividing EBITDA by total debt service costs.

EBITDA

Earnings Before Interest, Taxes, Depreciation, and Amortization, a measure of a company's operating performance.

Interest Charges

Costs incurred by borrowers for the use of borrowed money, typically expressed as an annual percentage rate.

Long-Term Debt

A financial obligation that is due for repayment in more than one year's time.