Which of the Following Statements Is TRUE

question 105

Multiple Choice

Which of the following statements is TRUE?

• A) With wider control limits (larger Z), the process is more likely to be in control.
• B) With narrower control limits, (smaller Z), the process is more likely to be in control.
• C) With wider control limits (larger Z), the process is less likely to be in control.
• D) none of the above are trueNone of these answer choices is correct.

---

Definitions:

Manufacturing Overhead Budget

An estimation of all manufacturing costs, excluding direct materials and direct labor, planned for a specific period.

Direct Labor-Hours

The cumulative hours that employees engaged in the manufacturing process have completed.

Variable Overhead Rate

The portion of overhead costs that varies directly with production volume, calculated as variable overhead costs divided by a certain measure of activity (e.g., labor hours or machine hours).

Fixed Manufacturing Overhead

Indirect production costs that remain constant regardless of the level of production, such as salaries, rent, and insurance.