Why Do Producer Prefer Direct Distribution

question 20

Multiple Choice

Why do producer prefer direct distribution?

• A) because it has more business transactions
• B) because they can handle orders that are smaller in size
• C) because they want to maintain control of the marketing mix
• D) because customers are usually widely dispersed across geographic areas
• E) because business products always use direct distribution

Calculate and analyze differential costs and their impact on decisions.

Determine product emphasis based on profitability and production constraints.

Evaluate the financial impact of discontinuing a product.

Rank products by profitability to optimize the use of constrained resources.

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Definitions:

Interest Expense

The cost incurred by an entity for borrowed funds, usually presented on the income statement as a cost of financing.

Note Payable

A written promise to pay a specific amount of money, usually including interest, at a future date or under specific conditions.

Adjusting Entry

Adjusting entry is a journal entry made at the end of an accounting period to allocate income and expenditure to the appropriate period.

Revenue Recognition

This is an accounting principle that outlines the specific conditions under which revenue is recognized and determines how to account for it.