Which of the Following Is NOT a Limitation to Using

question 33

Multiple Choice

Which of the following is NOT a limitation to using departmental operating income?

• A)It is difficult to determine each department's fair share of semidirect and indirect expenses.
• B)If one department is eliminated, many of the expenses allocated to it would continue.
• C)Managers rely more on contribution per department than on income from operations.
• D)It highlights the individual department's financial information.

---

Definitions:

Jobs

In accounting and manufacturing, specific units or batches of work that can be individually costed and tracked.

Administrative Expenses

Costs related to the general operation of a business, which are not directly tied to production or sales, such as salaries of administrative personnel and office supplies.

Patient-Visits

The number of individual patient encounters with healthcare providers, often used as a measure in medical and dental practices.

Spending Variance

The difference between the budgeted or standard cost of an activity and its actual cost.