Which of the Following Statements Regarding the Center-Of-Gravity Method Is

question 9

Multiple Choice

Which of the following statements regarding the center-of-gravity method is FALSE?

• A) It is designed to minimize the maximum possible travel distance to any of the locations.
• B) The optimal x- and y-coordinates are calculated separately.
• C) The optimal solution is unconstrained, so it could suggest a location in the middle of a body of water.
• D) The weights used are the quantity of goods moved to or from each location.
• E) The origin of the coordinate system and the scale used are arbitrary, just as long as the relative distances are correctly represented.

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Definitions:

Net Method

An accounting practice where purchase discounts for early payment are anticipated and recorded, reducing the cost of purchased goods.

Perpetual Inventory System

An inventory management approach that keeps continuous, real-time records of goods purchased and sold, reflecting current inventory levels at all times.

Merchandise Inventory

Goods that a company holds for the purpose of selling them to customers, representing one of the key assets on the balance sheet.

Accounts Payable

The liabilities a company has to its vendors or lending parties for products and services it has received but for which payment has not been made.