Question 1
Distinguish between controllable and uncontrollable aspects of revenue and costs. Can a manager totally control all revenue and costs? Why or why not?
Question 2
A company using responsibility accounting system decides to exclude all uncontrollable costs from a manager's performance report. Jenson is the machine supervisor. Which of the following costs will impact Jenson's performance report?
◦ rent and taxes paid on by the company
◦ cost of materials used in manufacture
◦ direct labor cost
◦ cost of power consumed by the plant