Why Is It Generally Harder for Service Industry Managers to Cope

question 6

Multiple Choice

Why is it generally harder for service industry managers to cope with peaks and troughs in demand for their products?

• A) Services are inconsistent
• B) There are no salespeople to help with forecasting
• C) Payment is usually made after the service has been provided
• D) Most service customers are not brand loyal
• E) Service products cannot usually be stored

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Definitions:

Payable

An accounting term for the amount of money a company owes to its creditors or suppliers for goods and services purchased on credit.

Debit Side

Refers to the left side of a general ledger account which is used to record increases in asset and expense accounts and decreases in liability, equity, and revenue accounts.

Credit Side

The right side of an accounting ledger where increases in liabilities, equity, and revenue, or the decrease in assets, are recorded.

T Account

A visual representation of a ledger account that displays both the debit and credit sides to track the balance of financial transactions.