Bypassing Regular Wholesale/retail Channels in Favor of Direct Sales and Internet

question 61

Multiple Choice

Bypassing regular wholesale/retail channels in favor of direct sales and Internet retailing can have appeal if it

• A)reinforces the brand, enhances consumer satisfaction, and results in lower prices to end users.
• B)can result in better coordination of the firm's direct sales activity to wholesalers and distributors.
• C)can establish a retail frontal attack while efficiently managing its backward (defensive)sales orientation.
• D)combines the best of all sales channels and provides financial support to distribution allies.
• E)creates a channel conflict, thereby providing competitive improvisation.

Critically assess the choice of allocation base in cost allocation.

Understand the principles and applications of job-order costing systems.

Analyze and perform calculations using the step-down method for allocating service department costs.

Calculate equivalent units of production using the weighted-average method.

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Definitions:

Economic Profit

The surplus generated after subtracting both direct and indirect expenses from the total revenue.

Pure Monopolist

A company or entity that is the sole provider of a particular product or service, without close substitutes, in a market.

Profit-Maximizing

The process or goal of setting production levels to achieve the highest possible profit based on current market conditions.

Total Cost

The aggregate of all costs, both fixed and variable, incurred in the production of goods or services.