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A) A list of all the items under the manager's control.
B) The budgeted amount for each item on the report.
C) The differences between the budgeted and actual amounts for each item on the report.
D) All of these are correct answers.
Correct Answer
verified
Correct Answer
verified
Premises
Practice of holding a manager responsible for revenue and expense items over winch he or she exercises predominant control
Type of responsibility center where the manager influences only costs and is held accountable for a specific output at a given level of cost
Measure of the ability of a firm or segment within a firm to utilize available resources effectively to generate a positive return for shareholders
Transfer price based on the external market price less any cost savings
Situation that motivates a manager to act in his or her own best interest even though the corporation as a whole may suffer
The point in an organization where the control over revenue or expense items is located
Transfer price that is based on the historical or standard cost incurred by the supplying segment
Type of responsibility center where the manager can influence revenues expenses, and capital invested in his or her center to attain the best performance possible
Type of responsibility center where the manager can influence both revenues and expenses for his or her center
Approach that evaluates a manager on his or her ability to maximize the dollar value of earnings above some targeted level of earnings
Reports comparing budgeted and actual controllable costs for each center within a firm
When variances from the budget are emphasized in reporting procedures so that management concentrates its attention on those variances from the budget
Transfer price that is established by agreement of both the selling and buying segments of the firm
Practice of delegating authority and responsibility for the operation of business segments
Responses
Controllability concept
Cost-based transfer price
Cost center
Decentralization
Investment center
Management by exception
Market-based transfer price
Negotiated transfer price
Profit center
Residual income
Responsibility center
Responsibility reports
Return on investment
Suboptimization
Correct Answer
Premises
Responses
Practice of holding a manager responsible for revenue and expense items over winch he or she exercises predominant control
Type of responsibility center where the manager influences only costs and is held accountable for a specific output at a given level of cost
Measure of the ability of a firm or segment within a firm to utilize available resources effectively to generate a positive return for shareholders
Transfer price based on the external market price less any cost savings
Situation that motivates a manager to act in his or her own best interest even though the corporation as a whole may suffer
The point in an organization where the control over revenue or expense items is located
Transfer price that is based on the historical or standard cost incurred by the supplying segment
Type of responsibility center where the manager can influence revenues expenses, and capital invested in his or her center to attain the best performance possible
Type of responsibility center where the manager can influence both revenues and expenses for his or her center
Approach that evaluates a manager on his or her ability to maximize the dollar value of earnings above some targeted level of earnings
Reports comparing budgeted and actual controllable costs for each center within a firm
When variances from the budget are emphasized in reporting procedures so that management concentrates its attention on those variances from the budget
Transfer price that is established by agreement of both the selling and buying segments of the firm
Practice of delegating authority and responsibility for the operation of business segments
Premises
Practice of holding a manager responsible for revenue and expense items over winch he or she exercises predominant control
Type of responsibility center where the manager influences only costs and is held accountable for a specific output at a given level of cost
Measure of the ability of a firm or segment within a firm to utilize available resources effectively to generate a positive return for shareholders
Transfer price based on the external market price less any cost savings
Situation that motivates a manager to act in his or her own best interest even though the corporation as a whole may suffer
The point in an organization where the control over revenue or expense items is located
Transfer price that is based on the historical or standard cost incurred by the supplying segment
Type of responsibility center where the manager can influence revenues expenses, and capital invested in his or her center to attain the best performance possible
Type of responsibility center where the manager can influence both revenues and expenses for his or her center
Approach that evaluates a manager on his or her ability to maximize the dollar value of earnings above some targeted level of earnings
Reports comparing budgeted and actual controllable costs for each center within a firm
When variances from the budget are emphasized in reporting procedures so that management concentrates its attention on those variances from the budget
Transfer price that is established by agreement of both the selling and buying segments of the firm
Practice of delegating authority and responsibility for the operation of business segments
Responses
Correct Answer
verified
Correct Answer
verified
Correct Answer
verified
Return on investment may be calculated ...View Answer
Correct Answer
verified
Return on investment may be calculated ...
View Answer
Correct Answer
verified
Correct Answer
verified
A) Based on negotiation.
B) Based on variable cost.
C) Based on standard cost.
D) Set by senior management.
Correct Answer
verified
Correct Answer
verified
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