Which of the Following Is Not an Item Which Is

question 53

Multiple Choice

Which of the following is not an item which is an appropriate candidate for a cost-based pricing approach?

• A) An item in which the seller contributes high added value through direct or indirect labor and specialized expertise.
• B) A complex item customized to specific requirements.
• C) A product requiring a conversion from raw material through value-added designs.
• D) A product requiring supplier-provided design and engineering support.
• E) Commodity-like items.

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Definitions:

Free Cash Flow

The revenue a firm accrues post-deducting expenses associated with operational support and upkeep of its capital goods.

Weighted Average

A calculation that takes into account the varying degrees of importance of the numbers in a data set, often used in accounting to find the average cost of goods sold.

Free Cash Flow

The amount of cash that a company generates after accounting for cash outflows to support operations and maintain capital assets.

Stock Options

Financial instruments that give the holder the right, but not the obligation, to buy or sell shares of a stock at a specified price before a specified date.