The Most Indirect Channel for Consumer Products Incorporates Agents, Wholesalers

question 19

Multiple Choice

The most indirect channel for consumer products incorporates agents, wholesalers, and retailers and is most commonly used when there

• A) are only a few large manufacturers but many small retailers.
• B) are low-cost, low unit volume goods.
• C) is too large an inventory to be carried by wholesalers.
• D) are many small manufacturers and many small retailers.
• E) are many manufacturers with a limited inventory competing for a small group of retailers.

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Definitions:

Profit Difference

The change in profit resulting from differences in sales, costs, or other financial factors between two periods.

Activity-Based Costing

A costing method that assigns costs to products or services based on the activities required to produce them, aiming to provide more accurate product costing.

Relevant Cost Decision Model

A decision-making tool that focuses on the costs directly related to a specific business decision, ignoring sunk costs and irrelevant expenses.

Recognises Revenues

The process of recording income in the financial statements when it is earned, according to the criteria set out in accounting standards.