Under Variable Costing, If a Manager's Bonus Is Tied to Operating

question 205

Multiple Choice

Under variable costing, if a manager's bonus is tied to operating income, then increasing inventory levels compared to last year would result in ________.

• A) increasing the manager's bonus
• B) decreasing the manager's bonus
• C) not affecting the manager's bonus
• D) being unable to determine the manager's bonus using only the above information

---

Definitions:

Graphical Techniques

Methods used to analyze and visualize data through graphs and charts for better understanding.

Histograms

A graphical representation of data using bars of different heights to show the frequency of data in consecutive and non-overlapping intervals.

Coefficient Of Correlation

A numerical measure that quantifies the degree and direction of the linear relationship between two variables, ranging from -1 to +1.

Numerical Techniques

Numerical techniques involve methods used for solving mathematical problems numerically, as opposed to analytically, often involving iterative methods, approximations, and simulations.