Financial ManagementQuestion 5538 of 217
All Questions ADivisional structure
BMulti divisional structure
CStrategic Business Unit
DNetwork structure
For any discrepancies in this question, email contact@cadada.in
Correct Answer
✅ Option A — Divisional structure
All Options:
- ADivisional structure ✓
- BMulti divisional structure
- CStrategic Business Unit
- DNetwork structure
Ad
Detailed Solution & Explanation
**Correct Answer: Option A — Divisional Structure**
**Explanation:**
M/s. SPG is described as a multi-product, multi-business enterprise with **four divisions**, each functioning as an **independent product centre** managed by a respective division head who is responsible for the division's own performance and profitability.
This precisely describes a **Divisional Structure**, where the organisation is divided into semi-autonomous units (divisions) based on products, markets, or geographies. Each division operates like a self-contained business with its own functional departments and a dedicated manager who is accountable for results.
**Why not the other options?**
- **Option B (Multi-divisional structure):** While superficially similar, the 'M-form' or multi-divisional structure is a more formal academic term referring to a corporate structure where divisions are managed by a central corporate HQ that coordinates and controls—the question's description emphasises independence, pointing squarely to divisional structure as the textbook term used in CA Inter syllabus.
- **Option C (Strategic Business Unit):** An SBU is a grouping of related divisions managed together for strategic planning purposes; it is not the same as each division acting as an independent product centre.
- **Option D (Network structure):** A network structure involves a loose, flexible web of independent organisations or units linked by contracts or alliances, which does not match the description.
Hence, **Option A** is the correct answer.
**Explanation:**
M/s. SPG is described as a multi-product, multi-business enterprise with **four divisions**, each functioning as an **independent product centre** managed by a respective division head who is responsible for the division's own performance and profitability.
This precisely describes a **Divisional Structure**, where the organisation is divided into semi-autonomous units (divisions) based on products, markets, or geographies. Each division operates like a self-contained business with its own functional departments and a dedicated manager who is accountable for results.
**Why not the other options?**
- **Option B (Multi-divisional structure):** While superficially similar, the 'M-form' or multi-divisional structure is a more formal academic term referring to a corporate structure where divisions are managed by a central corporate HQ that coordinates and controls—the question's description emphasises independence, pointing squarely to divisional structure as the textbook term used in CA Inter syllabus.
- **Option C (Strategic Business Unit):** An SBU is a grouping of related divisions managed together for strategic planning purposes; it is not the same as each division acting as an independent product centre.
- **Option D (Network structure):** A network structure involves a loose, flexible web of independent organisations or units linked by contracts or alliances, which does not match the description.
Hence, **Option A** is the correct answer.
Key Concepts to Understand
More Questions from Financial Management
If , and then is:
If , evaluate , , , and .
Out of a group of teachers in a school, teach Mathematics, teach Physics and teach Chemistry. teach Mathematics and Physics but none teach both Mathematics and Chemistry. How many teach Chemistry and Physics; how many teach only Physics?
If and then how many proper subset of can be created?
The number of subsets of the set is:
If and , then find the value of 'x'.
Ready to Master Financial Management?
Practice all 217 questions with instant feedback, earn XP, track your streaks, and ace your CA Foundation exam.
Start Practicing — It's Free