When a Textile Company Keeps Track of Its Inventory Using

question 138

Multiple Choice

When a textile company keeps track of its inventory using a computer and its competitor uses a pad of paper and a pencil, they are both answering the ________ part of one of the two big economic questions.

• A) "what"
• B) "how"
• C) "for whom"
• D) "where"

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Definitions:

Import Duties

Import duties are taxes imposed by a government on goods imported into a country, often used to protect domestic industries and raise revenue.

Merchandise Cost

Merchandise cost is the total expense incurred to purchase goods for resale, including the purchase price, shipping, handling, and import duties.

Gross Profit Method

A technique to estimate the amount of ending inventory and cost of goods sold by using the gross profit margin.

Gross Margin Ratio

A financial metric showing the percentage of revenue that exceeds the cost of goods sold, indicating the efficiency of a company in managing its production costs.