Which of the Following Is Not an Example of an External

question 28

Multiple Choice

Which of the following is not an example of an external error cost? 

• A) Reputation loss. 
• B) Costs of corrective measures. 
• C) Costs of processing return shipments from customers. 
• D) Loss of 'goodwill'.

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Definitions:

Fixed Costs

Costs that do not fluctuate with changes in production level or sales volume, such as rent, salaries, and insurance.

Margin Of Safety

The difference between actual or expected sales and the break-even point, indicating the level of risk in failing to cover fixed costs.

Breakeven

The point at which total costs and total revenue are equal, resulting in no net loss or gain.

Sales

The exchange of a commodity or service for money; the action of selling something.