A Firm That Divides Its Customers into Homogeneous Groups Based

question 68

Multiple Choice

A firm that divides its customers into homogeneous groups based on their locations is said to be practicing _____ segmentation.

• A) psychographic
• B) product-based
• C) geographic
• D) demographic

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Definitions:

Unit Product Cost

The total cost (including materials, labor, and overhead) divided by the number of units produced, indicating the cost to produce each unit of product.

Absorption Costing

A cost accounting method that includes all manufacturing costs - direct materials, direct labor, and both variable and fixed overhead - in the cost of a product.

Unit Product Cost

The total cost (both variable and fixed costs) associated with producing a single unit of a product.

Variable Costing

A method of inventory costing that includes only variable production costs—direct materials, direct labor, and variable manufacturing overhead—in product costs, excluding fixed manufacturing overhead.