Functional Structures Are More Appropriate Than Divisional Structures When

question 16

Multiple Choice

Functional structures are more appropriate than divisional structures when

• A)the environment is unstable.
• B)it is difficult to anticipate the demand.
• C)coordination requirements between jobs are inconsistent.
• D)the organization competes on costs.
• E)the environment is unpredictable.

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Definitions:

Variable Overhead Rate Variance

The difference between the actual variable overhead incurred and the standard cost allocated to production, based on the actual hours worked.

Machine-Hours

A measure of production time, calculated by the number of hours machines are operating in the manufacturing process.

Budget Variance

The difference between budgeted figures and actual figures for a particular accounting category.

Volume Variance

The difference between the expected and actual sales volumes, impacting revenue and expenses.