When Communicating Policies

question 18

Multiple Choice

When communicating policies:

• A) It is important to use legalese to demonstrate the formality of the document.
• B) Eliminate the legalese and tell employees what the policy means.
• C) Policies should be alphabetized to communicate that all policies are important.
• D) Include policies from all departments so the manual is standardized.

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Definitions:

Book Value

A rephrased definition: The net value of an asset or liability recorded on the financial statements, factoring in depreciation, amortization, and impairment, but not necessarily indicative of market value.

Activity-Based Method

An accounting method that assigns costs to products or services based on the activities and resources that go into producing them, to more accurately reflect the costs associated with each product or service.

Usage Hours

A measure of the time that an asset is actively used in production or operations.

Activity Method

A depreciation method where the asset’s expense is based on its usage or activity level, rather than the passage of time.