In Designing an Effective Management Control System for a Multinational

question 40

Multiple Choice

In designing an effective management control system for a multinational corporation, the accountant should measure factors appropriate for each unit's level of responsibility. Which of the following measures would be appropriate for evaluating the performance of an investment center?

• A) Output on costs of input
• B) Residual income
• C) EBIT
• D) All of the above

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Definitions:

Conglomerate

A sedimentary rock made up of rounded pebbles, cobbles, and boulders cemented together.

Unconformity

A surface of contact between two groups of unconformable strata, indicating a period of erosion or non-deposition.

Monocline

A geological fold where all strata are inclined in the same direction, resembling a step-like structure in the landscape.

Thrust Fault

A type of geological fault where one block of the earth's crust is pushed up and over another, typically at a low angle, due to compressional forces.