Which of the Following Statements Is True About the Financial

question 48

Multiple Choice

Which of the following statements is true about the financial terms and conditions of a sale?

• A) Price is often the last question asked.
• B) FOB installed indicates that title and responsibility are transferred before the equipment is installed and operating properly.
• C) Not having the cash can only delay a sale, but not prohibit it.
• D) Factors that affect price are the use of quantity and other discounts, as well as credit and shipping terms.
• E) FOB origin means the buyer will take responsibility for the goods once they reach the buyer's location, and the seller will pay the freight.

---

Definitions:

Cost Structure

The composition of a firm's fixed and variable costs, used to understand the financial impact of its operations and pricing strategies.

Unit Product Cost

The total cost to produce one unit of a product, including direct labor, direct materials, and allocated overhead expenses.

Operations

Refers to the day-to-day activities involved in the running of a business that are essential for producing and delivering goods or services.

Variable Costing

An accounting method that includes only variable costs—direct materials, direct labor, and variable manufacturing overhead—in product cost calculations.