Which of the Following Statements Is FALSE

question 41

Multiple Choice

Which of the following statements is FALSE?

• A)A public warehouse is a business that exists for the sole purpose of storing and tracking the inflow and outflow of the inventory.
• B)A warehouse arrangement is the riskiest collateral arrangement from the standpoint of the lender.
• C)Because the warehouser is a professional at inventory control,there is likely to be little loss due to damaged goods or theft,which in turn lowers insurance costs.
• D)A field warehouse is operated by a third party,but is set up on the borrower's premises in a separate area so that the inventory collateralizing the loan is kept apart from the borrower's main plant.

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Definitions:

Average Cost

The total cost of production divided by the number of units produced, reflecting the average expense per unit.

Standard Meals

Pre-defined, fixed meals that are regularly available in establishments like restaurants or cafeterias.

Producing

The process of creating goods or services.

Profit

The financial gain obtained when revenue from selling a product or service exceeds the costs of producing it.