A Manufacturer Would Try All Possible Means to Eliminate Intermediaries

question 41

True/False

A manufacturer would try all possible means to eliminate intermediaries and sell directly to its customers because they add unnecessary cost to customers.

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Definitions:

Direct Labor Hours

The total hours worked by employees directly involved in the manufacturing process or production of goods.

Budgeted Overhead

The estimated costs for overhead (indirect costs such as utilities, rent, and administrative salaries) that are planned for during a specific period in the budgeting process.

Total Overhead Rate

A ratio that calculates the total indirect costs of manufacture (including both fixed and variable overheads) relative to a related cost base, typically direct labor or machine hours.

Direct Labor Hours

Hours worked by employees that are directly involved in the manufacturing process, crucial for calculating product costs.