The most likely cost driver of distribution costs is the ________.
A) number of parts within the product
B) number of miles driven
C) number of products manufactured
D) number of production hours

Question

Quizplus · Accepted Answer

Distribution costs are largely determined by the distance that must be covered to transport the products to the customers. Therefore, the number of miles driven is likely the most significant cost driver for distribution costs. The other factors listed (number of parts within the product, number of products manufactured, and number of production hours) may impact other costs in the value chain, but are less relevant to distribution costs.

The Most Likely Cost Driver of Distribution Costs Is the ________