Common Cause Variation

question 72

Multiple Choice

Common cause variation

• A)Cannot be explained except in an aggregate sense
• B)Is easily detectable with statistical methods and control charts
• C)Cannot be reduced through better technology, process design, or training
• D)Is the responsibility of the workers who run the processes

---

Definitions:

Acid-Test Ratio

A financial metric that measures the ability of a company to pay off its short-term liabilities with its quick assets.

Year-End Information

Data and records compiled at the end of a fiscal year used for accounting and tax purposes, including final balances, inventories, and financial statements.

Perpetual Inventory System

An accounting method that continuously updates inventory records for sales and purchases, providing a highly current account of inventory on hand.

Net Method

An accounting technique where discounts for prompt payment are calculated and recorded immediately, reducing the purchase cost of inventory.