Asked by Tyson Fisher on May 19, 2024
Verified
Which of the following would be a relevant cost that would need to be considered for pricing a special order?
A) Additional set-up costs for the special order
B) Existing fixed manufacturing overhead
C) Non-manufacturing costs that will not change even if the special order is accepted
D) All of the costs are relevant costs
Relevant Cost
Costs that should be considered when making business decisions because they will be affected by the decision.
Special Order
An order for goods or services that is outside the company's regular scope of products or services and often tailored to a customer's specific requirements.
Additional Set-up Costs
Expenses incurred to prepare equipment or processes for manufacturing a new product or for a new production run, often not included in the standard operating costs.
- Analyze the importance of expenses when pricing unique orders and how capacity affects this process.
Verified Answer
Learning Objectives
- Analyze the importance of expenses when pricing unique orders and how capacity affects this process.
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