A Lock-Box Service Will Benefit the Following Firm the Most

question 47

Multiple Choice

A lock-box service will benefit the following firm the most.

• A)Firm has a large number of suppliers
• B)Firm writes a large number of cheques daily
• C)Firm has geographically dispersed customer base
• D)Firm sells goods to a very few customers

---

Definitions:

Standard Cost

An estimated or pre-determined cost of manufacturing a product or performing a service, used for budgeting and performance evaluation.

Variable Manufacturing Overhead

Indirect production costs that fluctuate with the level of production output, such as utilities for the manufacturing plant.

Direct Labor-Hours

The total number of hours worked by employees directly involved in manufacturing goods or providing services.

Direct Materials Purchases Variance

A measure used in managerial accounting to compare the actual cost of direct materials to the expected cost.