Select the Incorrect Statement Regarding Service Companies

question 96

Multiple Choice

Select the incorrect statement regarding service companies.

• A) Service companies do not maintain a Finished Goods Inventory account.
• B) Service companies accumulate their service costs in a Work in Process Inventory account similar to manufacturers.
• C) Service companies may have raw material costs.
• D) Understanding the cost of providing a service is just as important as knowing the cost of making a product.

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Definitions:

Identifiability

The extent to which individual members within a group can be recognized or distinguished based on their specific contributions or characteristics.

Performance Reviews

Evaluations conducted periodically to assess an employee's job performance, strengths, and areas for improvement.

Social Facilitation

The tendency for individuals to perform differently when in the presence of others, typically improving on simple tasks and doing poorly on complex tasks.

Energetic Performance

The level of vigor and enthusiasm displayed by individuals or groups in the execution of tasks.