Which of the Following Is True of the Service Sector

question 14

Multiple Choice

Which of the following is true of the service sector as opposed to manufacturing firms?

• A) The output of a service firm is intangible.
• B) A service firm considers that all customer needs are the same.
• C) Service firms usually maintain inventory registers.
• D) Service firms require a physical production site.

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Definitions:

Actual Indirect Factory Wages

This represents the wages paid to workers who are not directly involved in production but support the manufacturing process.

Budgeted Amounts

Financial plans that project income, expenditures, and allocations for a specific period, often used for control and decision-making purposes.

Actual Production

The real, quantifiable amount of goods or services produced by a company within a specific period.

Fixed Factory Overhead Volume Variance

A measure used in managerial accounting to assess the difference between the budgeted and the actual volume of production, affecting fixed overhead costs.