Because money has time value, a cash sale is always more profitable than a credit sale.
Answer the following statement true (T) or false (F)
False
Rationale: Department stores, auto dealers, and many others sell on credit, using interest bearing notes payable. The interest rate on this credit can exceed the firm's cost of capital, making credit sales more profitable than cash sales.
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Which of the following is likely if the distribution channel for a product in the foreign country is long?
A) the foreign country buyers pay a high price B) the consumer will pay arms-length price C) the profit margin of the sellers increase D) the intermediaries are motivated to reship the product to another country to earn higher profits E) the seller can increase profit margins by charging a uniform price
Which of the following is a drawback of the production-orientation philosophy?
a. It ignores the importance of assessing a firm's internal capabilities. b. It overlooks the importance of market research. c. It places little emphasis on the assessment of manufacturing plants and facilities. d. It gives importance to the sales function over other functions.
In a typical break-even analysis, a firm's fixed-cost contribution per unit
A. is the assumed selling price per unit minus the average fixed cost. B. usually decreases as the quantity produced increases. C. is the assumed selling price per unit minus the variable cost per unit. D. is total fixed cost divided by the quantity produced. E. usually increases as the quantity produced increases.
The numerical value of the slope of the fixed cost schedule is 1.0.?
Answer the following statement true (T) or false (F)