Commonly Used Indirect Channel Moves Product from Producer to Retailer

question 145

Multiple Choice

commonly used indirect channel moves product from producer to retailer to consumer.This channel is used when

• A) the retail outlets are regionally located.
• B) the cost of maintaining inventory is low.
• C) there is little if any seasonal demand.
• D) the risk lies solely with the manufacturer.
• E) the retailer is large and can buy in large quantities from a producer.

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Definitions:

Units Transferred Out

The total number of completed units moved from one production process to the next or to finished goods inventory.

Work In Process

An inventory account that tracks costs associated with partially completed goods.

Process Cost System

A method of accounting used for goods that are produced continuously or in mass quantities, allocating costs to units of product.

Conversion Costs

The costs required to convert raw materials into finished goods, typically including both labor costs and manufacturing overhead.