What Is the Most Important Factor That Causes Service Firms

question 88

Essay

What is the most important factor that causes service firms to generally rank lower in customer satisfaction than manufacturing firms?

---

Definitions:

Machine-Hours

A measure of the total run time that a machine is utilized for production over a specific period, often used as a basis for allocating overhead costs.

Direct Labor-Hours

A measure of the total hours worked by employees who are directly involved in the manufacturing process or production of goods.

Predetermined Overhead Rate

A rate used to apply manufacturing overhead to products or job orders, calculated before the period begins by dividing estimated overhead costs by an estimated allocation base.

Machine-Hours

A measurement of the amount of time machines are operated in the production process, used as an allocation base for applying manufacturing overhead.