Drop-Shippers

question 49

Multiple Choice

Drop-shippers:

• A) are used because it is cheaper for producers to ship to them by rail and let the drop-shipper drop the products off at local retailers with small trucks.
• B) never take title to the products they sell.
• C) typically sell large shipments, e.g., rail carloads.
• D) have very high operating expenses.
• E) are full-service merchant wholesalers.

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Definitions:

Accumulated Deficit

Accumulated deficit is a negative balance in retained earnings, indicating that a company's losses have exceeded its profits over time.

Statement Of Financial Position

A financial statement that shows the assets, liabilities, and equity of an entity at a specific point in time, providing a snapshot of its financial condition.

Net Debt

A financial metric calculated by subtracting total cash and cash equivalents from total debt, indicating a company's ability to pay off its debts if they were all due immediately.

Non-Business Organization

An entity that operates for purposes other than making a profit, such as charities, educational institutions, and government agencies.