IN A FREE MARKET ECONOMY, THE RATIONING OF SCARCE GOODS IS DONE PRINCIPALLY BY
A. the government B. business organizations C. the price mechanism ✓ D. consumers The answer to the question is: C. the price mechanism In a free market economy, the rationing of scarce goods is principally done by the price mechanism. This means that the…
THE FACTORY COST OF PRODUCING GOODS IS MADE UP OF
A. prime cost and factory overhead ✓ B. prime cost and office overhead C. raw materials consumed and fixed cost D. Raw materials and administrative overhead The answer to the question is: A. prime cost and factory overhead The factory cost of producing goods…
A COMPANY THAT SELLS ITS GOODS DIRECTLY IN FOREIGN COUNTRIES IS ENGAGING IN
A. Exportation ✓ B. Importation C. Franchising D. Licencing The answer to the question is: A. Exportation When a company sells its goods directly in foreign countries, it is engaging in Exportation. Exportation refers to the act of selling goods or services produced in…
ASSIGNING REVENUES TO THE ACCOUNTING PERIOD IN WHICH GOODS WERE SOLD OR SERVICES RENDERED AND EXPENSES INCURRED IS KNOWN AS
A. passing of entries B. consistency convention C. matching concept ✓ D. adjusting for revenue The answer to the question is: C. matching concept The matching concept, also known as the matching principle, is a fundamental accounting principle that requires expenses to be recognized…
DISTINGUISH BETWEEN SUBSTITUTE GOODS AND COMPLEMENTARY GOODS
Substitute goods and complementary goods are two concepts used in economics to describe the relationship between different products in the market. 1) Substitute Goods Substitute goods are products or services that can be used in place of one another to…
DOCUMENTS IN BUYING AND SELLING OF GOODS
MEANING OF COMMERCIAL DOCUMENTS Commercial documents are official papers which facilitate the act of buying and selling of goods. All business transactions must be backed by relevant documents in order to show authenticity as well as for record purposes, The…
CONTRACT OF SALE OF GOODS
DEFINITION OF SALE OF GOODS The Sale of Goods Act 1893 defines sale of goods as: ” A contract whereby the seller transfers or agrees to transfer the property in goods to the buyer for a money consideration called, the…
PRINCIPLES OF DEMAND
In order to know how a market economy works and how resources are allocated in an economic system, it is very important to understand what determines the demand and supply of goods and services. DEMAND Demand may be defined…
PURCHASE, SUPPLIES AND MERCHANDISING OF GOODS AND SERVICES
Marketing business is all about purchasing goods from manufacturer and making them available to consumers. Marketing outlet exist to bridge the gap between the manufacturer and the consumer by providing total marketing solutions to their clients. They purchase goods from…
INFLATION AND DEFLATION
Inflation may be defined as a persistent rise in the general price level of goods and services. Inflation occurs when the volume of purchases is permanently running ahead of production, with too much money in circulation chasing too few goods.…
INTERNATIONAL MARKETING
At its simplest level, international marketing involves the firm in making one or more marketing mix decisions across national boundaries. It is the total system of business activities designed to plan, price, promote and distribute goods and services to potential…
WAREHOUSING
We need different types of goods in our day-to-day life. We may buy some of these items in bulk and store them in our house. Similarly, businessmen also need a variety of goods for their use. Some of them may…
TRANSPORTATION
Transportation has to do with the movement of products from a source such as a plant, factory, or workshop to a destination such as a warehouse, customer, or retail store. Transportation may take place via air, water, rail, road, pipeline,…
MERCHANDISING
Merchandise means goods bought and sold or trading of goods. Merchandising is an activity of selling and promoting particular goods. Merchandising is a branch of marketing theory and practice concerned with maximizing product sales by designing, packaging, pricing, and displaying…
CONSUMER CHALLENGES AND RIGHTS
All person buying or consuming goods and services expects to get the best value for the money spent. He also has some rights and responsibilities over the quality of the goods bought and opportunity to seek redress. It is therefore…
Study Guide
