A Consequence of a Separation of Duties Is That

question 103

Multiple Choice

A consequence of a separation of duties is that

• A) operations become extremely inefficient because of constant training of employees.
• B) theft by employees becomes impossible.
• C) more employees will need to be bonded.
• D) theft is possible only when several employees are involved.

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Definitions:

Predetermined Overhead Rate

An estimated rate used to allocate manufacturing overhead costs to products or job orders, calculated before the costs are actually incurred.

Labor-Hour

A unit of measure representing one hour of work by an employee, often used in costing and budgeting processes.

Variable Overhead Efficiency Variance

The difference between the actual variable overhead incurred and the standard variable overhead allocated, based on the actual input of the allocation base.

Fixed Component

A cost that does not change with the increase or decrease in the amount of goods or services produced or sold.