Only Major Changes in the Scale or Scope of Operations

question 112

Multiple Choice

Only major changes in the scale or scope of operations can change ________ in future periods.Managers can very spending levels for ________ in the short run.

• A)committed fixed costs; capacity costs
• B)committed fixed costs; discretionary fixed costs
• C)discretionary fixed costs; capacity costs
• D)capacity costs; committed fixed costs

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Definitions:

General Management

The executive and organizational activities involved in directing a company or one of its departments, focusing on strategy, policy development, and achieving business objectives.

Physical Plant

Refers to the physical facilities of a business, including buildings and equipment.

Step-down Method

An allocation method used in cost accounting to distribute overhead costs to various cost centers and products in stages based on their usage of services.

Physical Plant Department

The division within an organization responsible for managing and maintaining the physical facilities, including buildings and grounds.