What Would Be an Example of Consumption Service

question 179

Multiple Choice

What would be an example of consumption service?

• A) Rhianna gets a haircut.
• B) Jake buys an iPhone.
• C) Antonio, the manager of the local Taco Hut, purchases a new deep fryer.
• D) The local driver's license office purchases a new digital camera and printer.
• E) Donald Trump purchases furniture for his office.

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Definitions:

Target Cost

A cost-management strategy in which a product’s selling price and desired profit are used to determine the allowable cost to manufacture it, with the aim of ensuring competitiveness and profitability.

Cost Driver Analysis

The examination of the factors that affect costs, aiming to understand the relationship between actions or volumes and their impact on expenses.

Non-value-added Activities

Tasks or processes that do not contribute to customer value or enhance a product, potentially leading to unnecessary costs.

Activity-Based Management

A management approach focusing on managing activities as the route to improving the value received by the customer and the profit achieved by providing this value.