When Analyzing Overhead Costs, Which of the Following Is a Key

question 17

Multiple Choice

When analyzing overhead costs, which of the following is a key point to investigate?

• A) Whether workers can produce goods more quickly and efficiently
• B) Whether direct materials prices are higher than standards
• C) Whether certain overhead costs are controllable or not
• D) Whether labor costs can be reduced

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Definitions:

Human Resource Surplus

A situation where there are more employees available within an organization than necessary, often leading to downsizing or layoffs.

Outsourcing

The practice of hiring third-party vendors to perform tasks, handle operations or provide services that are either difficult to manage or are outside the business's core competencies.

Contracting Out

The process of hiring external service providers to perform tasks, handle operations or provide services that are either difficult to manage or are outside the company's expertise.

Human Capital Shortages

A situation where there is a lack of skilled individuals available in the labor market to meet the demands of employers.