Controllable Costs Should Be Ignored in Evaluating the Responsibility Centre

question 89

True/False

Controllable costs should be ignored in evaluating the responsibility centre manager's performance.

Apply the laws of variance to calculate variance and standard deviation from a given probability distribution.

Calculate mean or expected value for specific probability distributions.

Understand fundamental concepts and properties related to the sum of variances and expected values.

Calculate and interpret the mean and standard deviation of derived distributions in practical contexts.

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Definitions:

Divergent Thinking

An approach or technique adopted to produce innovative ideas through the examination of numerous potential answers.

Convergent Thinking

A cognitive process in which multiple pieces of information are combined to solve a problem or come up with a single, correct solution.

Functional Fixedness

A cognitive bias that limits a person to use an object only in the way it is traditionally used, hindering the ability to see alternative uses.

Standardization

The development of uniform procedures for administering and scoring a test, and the creation of norms (performance standards) for the test.