Nico Owns a Gift and Card Shop and Is Currently

question 20

Multiple Choice

Nico owns a gift and card shop and is currently preparing a market summary. To be most effective, the competition section of his market summary should

• A)list only indirect competitors.
• B)focus only on competitors that sell the same product as he.
• C)list possible tactics to obtain a larger market share.
• D)list only direct competitors.
• E)list both direct and indirect competitors.

---

Definitions:

Direct Labor-Hours

The hours worked by employees directly involved in manufacturing goods, which is used as a basis for assigning labor costs to products.

Fixed Manufacturing Overhead

The portion of total manufacturing overhead costs that remains constant regardless of the level of production or activity volume.

Raw Material

Fundamental substances utilized during the manufacturing process to create products.

Standard Cost System

An accounting system that uses cost estimates for material, labor, and overhead to assign costs to products and analyze variances.