Which of the Following Statements About Doing a Situation Analysis

question 219

Multiple Choice

Which of the following statements about doing a situation analysis is correct?

• A) Libraries have good data on specific topics, but it is expensive to find.
• B) It doesn't make sense to start a situation analysis until the problem has begun to surface.
• C) Much good data are available from the government, but expensive.
• D) A good situation analysis is usually more expensive than collecting primary data.
• E) None of these statements about doing a situation analysis is true.

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Definitions:

Standard Costs

Preset costs for materials, labor, and overhead used to measure the performance of manufacturing activities against planned costs.

Variable Costing

A costing method where only variable costs are charged to product costs, with fixed costs treated as period costs.

Absorption Costing

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

Profit

The financial gain achieved when the revenue from business activities exceeds the expenses, costs, and taxes involved in maintaining the operation.