Reporting by Segments of a Business Is Believed to Have

question 13

Multiple Choice

Reporting by segments of a business is believed to have a number of advantages.Which of the following is not likely to be such an advantage?

• A) Allowing better assessment of expected returns from and risks of investing
• B) Preventing management from hiding failures in decision making
• C) Increasing the net profit of a business
• D) Improving investors' decision making

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Definitions:

Bottleneck

A point of congestion or blockage in a system, process, or production line that significantly delays or prevents progress.

Fixity of Production

The characteristic of production processes where inputs and outputs are fixed in the short term, allowing little flexibility.

Average Costs

is the total costs divided by the quantity produced, used to determine the cost of producing one unit of goods or services.

Average Cost

The aggregate expense of manufacturing, when divided by the quantity of items made.