Product and Target Market Characteristics Usually Determine the Type of Coverage

question 90

Multiple Choice

Product and target market characteristics usually determine the type of coverage a product receives.For which of the following products is selective distribution most appropriate?

• A) Gasoline
• B) Jaguar automobiles
• C) Cigarettes
• D) Laundry detergent
• E) Panasonic stereos

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Definitions:

Cash Basis

An accounting method where revenues are recognized when cash is received and expenses are recognized when paid.

Costs Expire

This concept relates to the recognition of expenses in the income statement when the underlying value or utility of the cost is consumed or no longer exists.

Operating Cycle

The time period between purchasing raw materials and collecting cash from selling finished goods, measuring the efficiency of a company's operations and cash flow.

Extraordinary Item

Unusual and infrequent gains or losses on a company's financial statements, not expected to recur in the foreseeable future, a concept that has been phased out in many accounting standards.