When measuring a division's operating costs,indirect controllable operating costs include
A)labor used in the division's production.
B)salary of the division manager (controlled by top management)
C)costs of providing centralized services,such as data processing and employee training.
D)company president's salary.

Question

Quizplus · Accepted Answer

Indirect controllable operating costs are those costs that are not directly related to the production process but can still be controlled by the division manager with proper planning and decision-making. The costs of providing centralized services such as data processing and employee training come under this category as they can be controlled by the division manager. Options A and D are incorrect as they are direct costs and are not indirect controllable operating costs. Option B is also incorrect as the salary of the division manager is controlled by top management and not directly controlled by the division manager.

When Measuring a Division's Operating Costs,indirect Controllable Operating Costs Include