The Manager of Each Physical Distribution Function Attempts to Minimize

question 68

Multiple Choice

The manager of each physical distribution function attempts to minimize costs. However, due to the impact of one physical distribution task on the other, he/she obtains less than optimal results. What is this condition called?

• A) slow order processing
• B) suboptimization
• C) inventory fluctuations
• D) poor customer service standard

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Definitions:

Flexible Budget

A budget that adjusts or changes according to the level of activity or volume of production in an organization.

Budgeting

The process of creating a plan to spend your money, outlining future financial goals and strategies for achieving them.

Activity Variance

The difference between the budgeted amount of activity and the actual amount, often analyzed in budgeting and variance analysis to manage costs.

Revenue

The total amount of income generated by the sale of goods or services related to a company's primary operations.