Which of the Following Statements Regarding Internal Development as a Means

question 13

Multiple Choice

Which of the following statements regarding internal development as a means of diversification is false?

• A) Many companies use internal development to extend their product or service offers.
• B) An advantage of internal development is that it is generally faster than other means of diversification.
• C) The firm can capture wealth created without having to share the wealth with alliance partners.
• D) Firms can often develop products or services at a lower cost if they rely on their own resources instead of external funding.

Distinguish between situations appropriate for process costing and job order costing.

Calculate and interpret the total cost assigned to ending work in process and completed units.

Understand the concept and calculation of conversion costs per equivalent unit.

Recognize the significance of tracking processing costs separately for materials, labor, and manufacturing overhead in a processing system.

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Definitions:

Direct Labor Cost

The cost associated with the work of employees who are directly involved in the manufacturing of products.

Absorption Costing

A method of inventory costing in which all costs of manufacturing are included in the cost of goods sold, including direct materials, direct labor, and both variable and fixed manufacturing overhead.

Unit Product Cost

The cost assigned to a single unit of product, encompassing all expenses directly and indirectly involved in its production.

Direct Labor Cost

The total cost of all the labor directly involved in the production of goods or services.