To Reduce the Variability of Its Output and Improve Its

question 6

Multiple Choice

To reduce the variability of its output and improve its productivity,a service firm might ______.

• A)decrease the degree of customer interaction
• B)increase the degree of customization it provides
• C)switch to a different product
• D)switch to a different market

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Definitions:

Inventory

The raw materials, work-in-progress goods, and completely finished goods that are considered to be the portion of a business's assets that are ready or will be ready for sale.

Net Realizable Value

The estimated selling price of goods minus the costs of their sale or disposal, used in inventory valuation and accounts receivable.

Write-Down

A reduction in the book value of an asset when its market price falls below its carrying value on the balance sheet.

Gross Profit

The difference between revenue and the cost of goods sold, representing the basic profitability of the products or services sold by a company.