A Business Subunit That Consists of a Collection of Functions

question 28

Multiple Choice

A business subunit that consists of a collection of functions or departments that share responsibility for producing a particular product or service is known as a(n) _____.

• A) partition
• B) division
• C) structure
• D) union
• E) formation

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Definitions:

Capacity

The maximum level of output that a company can sustain to make a product or provide a service under normal conditions.

Activity-Based System

A method in accounting that allocates costs to specific activities based on their use of resources, aimed at providing more accurate cost information.

Non-Volume-Based Costs

Costs that do not vary directly with the volume of production or sales, often encompassing fixed costs like rent or salaries.

Volume-Based Costs

Costs that vary directly with the level of production or sales volume, such as direct materials and direct labor, contrasting with fixed costs that remain constant regardless of volume.