Dopson's Hardware Was in Bad Financial Shape

question 74

Multiple Choice

Dopson's Hardware was in bad financial shape.It owed so much money that vendors put the store on a cash-only delivery basis.As a result,the store had a dwindling inventory of goods to sell.Whenever a customer asked about an unavailable item,the owner directed the sales staff to say that it was on backorder and would be in stock next week.When the customer returned,the item was still unavailable.The owner's policy created a(n) __________ gap.

• A) knowledge
• B) empowerment
• C) communication
• D) standards
• E) tangibility

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Definitions:

Work in Process Inventory

The value of unfinished goods in the production process at a specific point in time.

Direct Materials

Raw materials that can be directly traced to the production process of a product and are considered a part of the finished product.

Direct Labor

The cost of wages paid to workers directly involved in the production of goods or services.

Job Order Cost Sheets

Documents that record and track the costs associated with a specific job or order.