Figure 7-2

question 178

Multiple Choice

Figure 7-2.Steller Manufacturing has two classes of distributors: JIT distributors and non-JIT distributors. The JIT distributor places small, frequent orders and the non-JIT distributor tends to place larger, less frequent orders. Both types of distributors purchase the same product. The customer activities and costs for the previous quarter are found below:

-Refer to Figure 7-2. Calculate the total customer cost for the JIT distributor.

• A) $487,500
• B) $341,753
• C) $600,000
• D) $250,050
• E) $448,791

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Definitions:

Channel Of Distribution

Refers to the path or route through which goods and services travel from the producer or supplier to the end consumer.

Markup

The amount added to the cost price of goods to cover overhead and profit; expressed as a percentage of the cost.

Selling Price

The amount of money a buyer pays to purchase an item from a seller.

Trade Advertising

Advertising directed towards professionals within a specific industry, as opposed to general consumers, to promote products or services.