Which Department Is Responsible for Setting Price Standards for Materials

question 43

Multiple Choice

Which department is responsible for setting price standards for materials and labour?

• A)Personnel must consider discounts, freight, and quality.
• B)Purchasing must consider payroll taxes, fringe benefits, and qualifications.
• C)It is the joint responsibility of operations, purchasing, personnel, and accounting.
• D)Purchasing must consider the quantity of materials.

---

Definitions:

Sustainable Growth Rate

The maximum rate at which a company can grow its sales, earnings, and dividends without increasing its financial leverage.

Debt to Equity Ratio

The ratio showing the variance in financing methods between debt and equity for a company’s assets.

Dividend Payout Ratio

The fraction of net income a firm pays to its shareholders as dividends, expressed as a percentage of the company's total earnings.

Retention Ratio

A financial metric indicating the percentage of a company's net income that is not distributed as dividends but rather retained for reinvestment in the business.