A Major Difference Between Functional Accounts and Natural Accounts Is

question 1

Multiple Choice

A major difference between functional accounts and natural accounts is that functional accounts

• A) are based on the contribution-margin approach and natural accounts are based on the full cost approach.
• B) always total to a lower overall expense than the total of the natural accounts.
• C) might be used to compare the costs of serving different customers-but natural accounts are not suited to that purpose.
• D) are the basis for most accounting systems, but natural accounts are more useful for marketing managers.
• E) do not consider fixed costs, but natural accounts do.

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Definitions:

Price Sensitivity

How much the desire for a product or service shifts in response to price variations.

Strategic Decisions

High-level choices that determine the direction and success of an organization.

Weekly Profit

The amount of financial gain made in a business operation over the course of a week.

Gray Market

The sale of branded products through legal but unauthorized distribution channels.