Question

True or False: Activity-based costing (ABC) techniques used to evaluate customer profitability can also be applied to evaluating suppliers.

True or False: Quality can be defined as the degree to which a product or service performs as it was designed to do.

True or False: The basic concepts involved in activity-based costing (ABC) can be used to determine customer profitability as well as product costs.

True or False: Tangible customer expectations include how the product's salespeople treat customers and the time required to deliver the product to the customer.

Answer 1

1.) Activity-based costing (ABC) techniques used to evaluate customer profitability can also be applied to evaluating suppliers.

TRUE - As the cost drivers are used in ABC it can help, to evaluate suppliers and chose them wisely.

2.) Quality can be defined as the degree to which a product or service performs as it was designed to do.

TRUE - Design is the foremost and most important detreminant of Quality.

3.) The basic concepts involved in activity-based costing (ABC) can be used to determine customer profitability as well as product costs.

TRUE - Using ABC we can evaluate the profitability at the end as well as the product cost with the help of cost drivers.

4.) Tangible customer expectations include how the product's salespeople treat customers and the time required to deliver the product to the customer

FALSE- How salespeople treat are the INTANGIBLE Customer Expectations and not the Tangible.

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