Airfreight Generally Increases Both Transporting Cost and the Total Cost

question 93

True/False

Airfreight generally increases both transporting cost and the total cost of distribution because it tends to add to inventory costs, spoilage, theft, and damage.

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Definitions:

Budgets

Financial plans that estimate revenue and expenditures over a specific period, helping organizations plan their finances.

Standard Costs

Predetermined costs for materials, labor, and overhead used for budgeting and assessing performance.

Variable Overhead

Costs that vary with the level of production output, such as utilities and commissions.

Materials Price Variance

The difference between the actual cost of materials and the standard cost, multiplied by the actual quantity of materials used.