Utilization Will Always Be Lower Than Efficiency Because

question 31

Multiple Choice

Utilization will always be lower than efficiency because:

• A)effective capacity is less than design capacity.
• B)effective capacity is greater than design capacity.
• C)effective capacity equals design capacity.
• D)expected output is less than actual output.
• E)expected output is less than rated capacity.

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Definitions:

R&D Costs

Expenditures related to the research and development of company’s products or services.

Impairment Losses

Financial losses recognized when the carrying amount of an asset exceeds its recoverable amount.

GAAP

Generally Accepted Accounting Principles, a standard framework of guidelines for financial accounting used in any given jurisdiction, notably the U.S.

IFRS

International Financial Reporting Standards - a set of accounting standards developed by the International Accounting Standards Board that is used globally.