A Decentralized Organizational Structure May Result in Duplication of Activities

question 128

True/False

A decentralized organizational structure may result in duplication of activities.

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Definitions:

Degree Of Operating Leverage

A measure, at a given level of sales, of how a percentage change in sales will affect profits. The degree of operating leverage is computed by dividing contribution margin by net operating income.

Variable Expenses

Costs that vary in direct proportion to changes in an activity level or volume, such as sales commissions.

Sales Increase

The rise in the volume or amount of sales or revenue a company achieves in a specific period compared to a previous period.

Advertising Campaign

A series of advertisement messages in various media that share a single idea and theme intended to achieve marketing objectives.