Which of the Following Statements About the Distinction Between Consumer

question 198

Multiple Choice

Which of the following statements about the distinction between consumer goods and B2B goods is the most accurate?

• A)The same product can be classified as either a consumer good or an industrial good,depending upon its end use.
• B)Industrial goods tend to have a useful life of several years and can be depreciated while consumer goods typically last less than a year.
• C)Consumer goods are typically more expensive than industrial goods.
• D)Industrial goods are custom made to the specifications of the buyer,while the all consumer goods are mass-produceD.The classification of a product as a consumer good or an industrial product is based on the buyer's reason for buying and the end use of the product.A loaf of bread bought by a household would be a consumer good,while the same loaf bought by a restaurant would be an industrial good.

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Definitions:

IFRS

International Financial Reporting Standards; a set of accounting standards developed by the International Accounting Standards Board (IASB) aiming at standardizing financial reporting across the globe.

Liquidity

A measure of a company's ability to pay off its short-term liabilities with its available cash and quick assets.

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within one year or within the business's normal operating cycle if longer.

Operating Cycle

The average period of time it takes for a business to convert its inventory into cash through sales.