A Product's Form Utility Is Created When Value Is Added

question 18

Multiple Choice

A product's form utility is created when value is added to the product through a manufacturing,production or assembly process.However,logistics activity can provide form utility also.Which is an example of the creation of form utility by a logistics activity?

• A) when lumber is cut and made into a chair
• B) when a firm's finance manager approves customer purchases on a credit basis
• C) when bulk computer disks in different colors are packed in three-color assortments for sale to computer users
• D) the breaking bulk and repackaging at a distribution center

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Definitions:

Period End

The conclusion of an accounting period, at which time financial statements are prepared and financial activities are summarized.

Transfer

The movement of resources, products, or services from one part of an organization to another.

Manufacturing Firm

A business involved in the industrial production or manufacturing of goods, typically using machinery and labor.

Goods Completed

Finished products that have undergone the entire production process and are ready for sale.