Managerial Entrenchment Means That Managers ________ and Run the Firm

question 46

Multiple Choice

Managerial entrenchment means that managers ________ and run the firm for their own best interests.

• A)may face little threat of being fired
• B)are overseen by equity holders
• C)are overseen by debt holders
• D)are well compensated
• E)wish to leave the firm

---

Definitions:

Direct Method

An approach in cost accounting where specific costs are directly traced to cost objects without any allocation, ensuring clear cost attribution.

Operating Activities

Activities related to the day-to-day functioning of a business, including selling, administering, and producing goods and services.

Long-term Investments

Investments held for an extended period, typically more than a year, such as bonds, stocks, or real estate, aiming for long-term benefits.

Bonds Payable

Long-term liabilities representing money a company owes to bondholders.