As the Only Store to Design and Sell Curtains in the Suburb

question 48

Multiple Choice

As the only store to design and sell curtains in the suburb of Oakland, the merchandise sold by Plush Parade is overpriced.Noticing this, Diana's Draperies sets up a showroom in the same suburb, reasoning that with lower prices, they would be able to attract more customers.Diana's Draperies is Plush Parade's

• A)partner.
• B)distributor.
• C)competitor.
• D)processor.
• E)franchiser.

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Definitions:

FIFO

FIFO (First-In, First-Out) is an inventory cost valuation method assuming that the oldest items of inventory are sold first and newer inventories last, affecting the cost of goods sold and ending inventory valuation.

LIFO

Last In, First Out, an inventory valuation method that assumes goods purchased last are the first to be used or sold, affecting cost of goods sold and inventory value.

Average

A statistical measure that denotes the central value of a set of numbers.

Dollar-Value LIFO

An inventory valuation method that uses the last-in, first-out (LIFO) principle but measures inventory in dollar amounts rather than in physical units.