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R&G Sells Lighting Fixtures to Homeowners,government Institutions and Commercial Buyers

Question 51

Multiple Choice

R&G sells lighting fixtures to homeowners,government institutions and commercial buyers.Its sales force is organizing according to customer.The following is a profit and loss statement for each division using the full-cost approach: R&G sells lighting fixtures to homeowners,government institutions and commercial buyers.Its sales force is organizing according to customer.The following is a profit and loss statement for each division using the full-cost approach:   -What would an advocate of the full-cost approach to marketing cost analysis do with this information? A) Re-allocate costs to cover the loss to homeowners B) Eliminate the division that sells to homeowners C) Wait another year to see if the loss occurs again D) Do a trend analysis of the net profits/losses of this division to forecast what will happen in upcoming years E) Put more sales effort into the commercial division to take advantage of the  easy  profits
-What would an advocate of the full-cost approach to marketing cost analysis do with this information?


A) Re-allocate costs to cover the loss to homeowners
B) Eliminate the division that sells to homeowners
C) Wait another year to see if the loss occurs again
D) Do a trend analysis of the net profits/losses of this division to forecast what will happen in upcoming years
E) Put more sales effort into the commercial division to take advantage of the "easy" profits

Correct Answer:

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