The Practice of Organizing the Cost-Effective Flow of Raw Materials

question 120

Multiple Choice

The practice of organizing the cost-effective flow of raw materials, in-process inventory, finished goods, and related information from point-of-origin to point-of consumption to satisfy customer requirements is referred to as __________.

• A)physical distribution management
• B)logistics management
• C)production management
• D)manufacturer distribution logistics
• E)supply-chain management

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Definitions:

Contribution Margin

The difference between sales revenue and variable costs, indicating how much revenue is available to cover fixed costs and generate profit.

Variable Cost

Costs that change in proportion to the level of activity or volume of production, such as materials and labor.

Cost of Goods Sold

The total cost directly associated with producing the goods sold by a business during a specific period, including labor, materials, and manufacturing overhead.

Product Costs

The costs directly associated with producing goods, including direct materials, direct labor, and manufacturing overhead.