Supplier Performance Should Be Compared Based on

question 47

Multiple Choice

Supplier performance should be compared based on

• A) purchase price alone.
• B) their impact on total cost.
• C) the supplier's quality of material.
• D) the ability of the supplier to coordinate forecasting and planning.

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Definitions:

Raw Materials

The basic, unprocessed or partially processed materials used to produce goods and finished products in manufacturing.

Work in Process Inventory

Goods partially completed in manufacturing but not yet ready for sale, reported as a current asset.

Manufacturing Overhead Applied

The allocation of manufacturing overhead costs to units of product based on a predetermined rate or base.

Overhead Applied

The allocation of indirect costs to produced goods or services based on predetermined rates.