For Short Term Incentives, What Does the Term Fund Size

question 11

Multiple Choice

For short term incentives, what does the term fund size refer to?

• A) The amount each employee will receive from productivity gains
• B) The total amount of bonus money that will be available to be paid out
• C) The percentage of the company's net income to be paid out
• D) The incentive bonus amount when targets are exceeded
• E) The bonus money available for each level of management

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Definitions:

Variable Costs

Costs that vary directly with the level of production or sales volume, such as materials and labor.

Plant Manager's Salary

Compensation awarded to the individual responsible for overseeing the operations of a manufacturing facility or plant.

Raw Materials

Basic substances in their natural, modified, or semi-processed states, used as inputs for production.

Cost of Goods Sold LIFO

An inventory costing method where the last items placed into inventory are the first ones to be recorded as sold, which can affect the cost of goods sold and inventory valuation.