Blake Took a Marketing Class at the Local Community College

question 263

Multiple Choice

Blake took a marketing class at the local community college before starting his landscape business. He decided that his time would be better utilized in this class because if he could learn to sell his services well, the revenues and profits would follow. Your assessment of his plan might include which of the following?

• A) Blake understands that marketing is the lifeblood of the company, and he is right on track with his approach.
• B) Blake has elected to operate like a virtual company and leave various parts of the business including accounting, environmental trends scanning, and management to outsourcers.
• C) Blake knows that increasing revenues will always keep the business profitable and in a positive cash position.
• D) Blake needs to realize that the ability to understand and interpret financial statements provided by his accountant might enhance his profits.

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Definitions:

Price Paid

The total monetary expenditure incurred to acquire a product or service, which includes the purchase price and any additional costs.

Materials

Physical items that are used in the production of goods and services, often classified as direct materials (used directly in the final product) and indirect materials (not directly identifiable with the final product).

Direct Labor Rate

The cost per hour for labor directly involved in manufacturing a product or providing a service.

Efficiency Variances

The differences between the actual inputs used in production and the standard inputs, reflecting production efficiency.