In Order to Be Useful,a Test Must Be Valid,that Is,it

question 235

Multiple Choice

In order to be useful,a test must be valid,that is,it must:

• A)measure what it is designed to measure.
• B)compare results against established standards of performance.
• C)produce the same results from one time to the next.
• D)produce comparable results when alternate forms are given.

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Definitions:

Absorption Costing

An accounting method that includes all manufacturing costs (direct materials, direct labor, and both variable and fixed manufacturing overhead) in the cost of a product.

Residual Income

A performance measure for investment centers that subtracts the opportunity cost of the investment from the income generated by the assets of the investment.

Senior Management

High-level executives responsible for the overall management and effectiveness of an organization.