Which of the Following Is the Definition of Benchmarking

question 121

Multiple Choice

Which of the following is the definition of benchmarking?

• A) Benchmarking is the study of percentage changes in financial statement line items year to year.
• B) Benchmarking is the analysis of a financial statement that shows each item as a percentage of net sales or total assets.
• C) Benchmarking is the practice of comparing a company with other companies in that industry.
• D) Benchmarking is the comparison of two companies using horizontal analysis.

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Definitions:

High-Low Method

A technique used in accounting and finance to estimate fixed and variable costs based on the highest and lowest levels of activity.

Factory Machine Hours

A measure of production time, indicating the total hours that machinery is operated in the manufacturing process.

Power Costs

The expenses incurred by a company for the electricity or energy used in its operations.

Sales Price

The amount of money for which a product or service is sold to the customer.