A Company's Decision on Where to Locate a New Factory

question 44

Multiple Choice

A company's decision on where to locate a new factory is most likely a result of:

• A) operating activities.
• B) operational planning.
• C) strategic planning.
• D) controlling activities.

---

Definitions:

Excess Capacity

The unused production capability of a company, indicating that the company can produce more than is currently being demanded.

Expense Allocation

The process of identifying, aggregating, and assigning costs to cost objects like departments, products, or projects.

Operating Departments

Operating departments are the functional areas within an organization directly involved in producing the company's main goods or services, such as production or sales departments.

Direct Expenses

Direct expenses are costs that can be directly traced to a specific department, project, or activity, such as raw materials and labor used in the production of goods.