Q1. The reluctance of managers to lay off employees when activity declines in the short-run leads to an increase in the ratio of variable to fixed costs.
True
False
Q2. Fixed costs expressed on a per unit basis vary inversely with changes in activity.
True
False
Q3. Contribution margin and gross margin mean the same thing.
True
False
Q4. Generally speaking, it is the responsibility of the production department to see that material usage is kept in line with standards.
True
False
Q5. Practical standards allow for normal machine downtime and employee rest periods.
True
False
Q6. A standard can be regarded as the budgeted cost for one unit of product.
True
False
Q7. Different companies, having different strategies, should have different balanced scorecards even if they are in the same industry.
True
False
Q8. Throughput time is the amount of time required to process raw materials into completed products.
a. True
b. False
Q9. An unfavorable labor rate variance can occur if workers with high hourly wage rates are assigned to work on products whose standards assume workers with low hourly wage rates.
a. True
b. False
Q10. In using a statistical control chart, observation points plotted between the upper and lower limits are considered to be random or chance occurrences and would not typically result in an investigation.
a. True
b. False